Professor Lunini, a professor at New York University's Stern School of Business and CEO of Roubini Macro Associates, served as a senior economist in international affairs at the White House Council of Economic Advisers during the Clinton administration. He has also worked with prestigious institutions such as the International Monetary Fund (IMF), the Federal Reserve, and the World Bank. In this interview, he shares his critical views on Bitcoin and blockchain technology.
Even after a major correction earlier this year, the price of Bitcoin and other cryptocurrencies remains high, and some tech enthusiasts still believe that blockchain will revolutionize business models. However, Professor Lunini argues that blockchain is one of the most overhyped technologies in history. It is not only inefficient compared to traditional databases but also consumes massive amounts of energy and computing power.
Predicting the failure of Bitcoin often sparks strong reactions from blockchain advocates. While many initial coin offerings (ICOs) have failed—over 1,500 of them are related to cryptocurrency—Lunini believes that even if most of them fail, the impact of blockchain on finance and society could still be significant. However, he stresses that the technology itself is not yet mature enough to replace existing systems.
Blockchain is often praised for its decentralized nature, but banks already handle millions of transactions daily using highly efficient centralized systems. There is little reason to adopt less efficient alternatives unless there’s a clear need. Financial institutions, especially those involved in algorithmic trading, require fast and reliable transaction processing, which blockchains like Ethereum currently cannot provide.
Another common misconception is that blockchain is a new general-purpose protocol, similar to TCP/IP or HTML. But unlike these foundational protocols, blockchain is "stateful," meaning it maintains a record of all previous transactions. This makes it more complex and harder to scale. For example, Bitcoin can only process 5–7 transactions per second, while Visa handles 25,000.
Moreover, the idea that blockchain will replace traditional systems is unrealistic. It relies on existing infrastructure like TCP/IP, and its limitations—such as scalability and energy consumption—make it unsuitable for widespread use. The expansion problem remains unsolved and may persist for years.
While blockchain may not replace core internet protocols, specific applications like Ethereum-based smart contracts could become standards for certain apps, much like how Linux and Windows operate on personal computers. However, investing in individual cryptocurrencies is not the same as betting on a universal standard. Converting market capital into digital assets without real utility doesn’t make sense.
One of the biggest myths is that blockchain eliminates financial intermediaries. This is impractical because financial contracts are often subject to change or breach. Creating rigid, immutable agreements would be costly and inefficient, especially when requiring 100% collateral for every transaction.
In reality, many blockchain applications in finance—such as securitization or supply chain monitoring—still rely on intermediaries for flexibility and problem-solving. Smart contracts can help ensure transparency and clarity, but they don't eliminate the need for human judgment.
It's time to move past the hype. Bitcoin is slow and energy-intensive, Ethereum's proof-of-stake system could be manipulated by insiders, and Ripple’s technology may soon be overtaken by established systems like SWIFT. Meanwhile, centralized payment platforms like Alipay, WeChat Pay, and Venmo offer faster, cheaper, and more widely used solutions.
The current cryptocurrency frenzy is reminiscent of the railway mania in the 19th century. When bubbles burst, they tend to collapse. Blockchain itself may not be revolutionary, but it holds potential when combined with industries like finance and automation. However, it's important to approach it with realism rather than blind optimism.
Outdoor Cabinet Air Conditioner
Industrial Air Conditioner,Cabinet Heat Exchanger,Peltier Air Conditioner,Industrial Aircon
Guangdong Yuqiu Intelligent Technology Co.,Ltd , https://www.cntcetltd.com