There have been many outspoken opponents to leading cryptocurrency Bitcoin BTC/USD over the years.
Among the critics is Nobel laureate and economist Paul Krugman. Here's a look back at a famous tweet from Krugman in 2022 concerning Bitcoin.
What Happened: Investors like Warren Buffett have criticized Bitcoin and said there is no value to the leading cryptocurrency, calling it "rat poison squared" previously.
Krugman, who is known to give his takes on the economy, inflation and other broad based economic ideals, has often criticized cryptocurrency.
In June 2022, with the cryptocurrency market pulling back, Krugman took a shot at Bitcoin.
"OK, folks, this is getting impressive," Krugman tweeted on June 18, 2022.
Krugman attached a chart for Bitcoin showing the leading cryptocurrency going from around $46,000 at the start of 2022 to $18,250.70. The chart showed a year-to-date drop of 62%.
2022 marked a drop in the price for many major cryptocurrencies, which was escalated by the bankruptcies of several cryptocurrency companies including FTX.
In December 2022, Krugman went on to blast the cryptocurrency sector after the bankruptcy of FTX.
"We are, many people say, going through a ‘crypto winter.' But that may understate the case. Instead, this is looking more and more like Fimbulwinter, the endless winter that, in Norse mythology, precedes the end of the world."
Krugman said that it could be the end of "the crypto world" and the idea of the blockchain.
"The original rationale for Bitcoin was that it would do away with the need for trust."
Bitcoin and other cryptocurrencies rebounded in 2023 and into 2024, with the approval of Bitcoin ETFs marking a major event for the sector.
With Bitcoin hitting new 52-week highs, some on social media were quick to highlight Krugman's past tweet and predictions. Here's a look at the outcome of a hypothetical investment in Bitcoin at the time of Krugman’s tweet.
Related Link: Nobel Laureate Paul Krugman Slams Venmo After Payment Trouble — Bitcoin Fixes This, Says Michael Saylor
Investing $1,000 in Bitcoin: Krugman's chart shared on June 18, 2022 shows a price of $18,250.70 for Bitcoin. The cryptocurrency hit a high of $20,736.04 that day, which will be used for the illustration of this hypothetical investment.
An investor could have purchased 0.0482 BTC on June 18, 2022 with $1,000. The $1,000 investment would be worth $2,489.64 today, based on a price of $51,652.26 for Bitcoin at the time of writing.
This marks a hypothetical gain of +149.0% from the time of Krugman's tweet.
For comparison, the same $1,000 invested in the SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500 stock market index, would be worth $1,334.99. The same $1,000 could have purchased 2.69 SPY shares on June 21, which was the Monday after Krugman's Saturday tweet.
The SPDR S&P 500 ETF investment would be up 33.5% over the same time period.
This means an investment in Bitcoin at the time of Krugman's criticism significantly outperformed the broad stock market over the same time period.
Photo: Created with a photo from Commonwealth Club on Flickr.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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