Economist William J. Luther said he doesn’t think the dollar will be challenged by the Bitcoin or any other digital currency any time soon.
In the Jan. 9 talk held by Praxis, Hillsdale College’s economics club, the assistant professor of economics from Kenyon College said he thinks Americans will continue to use dollars, even while financial institutions adopt some of the technologies used in Bitcoin transactions.
“I think we will adopt that technology in one way or another, that is we’ll use that technology to process dollar transactions,” Luther said. “Most people just aren’t interested in using some new money and so they won’t.”
The blockchain, which Luther described as a sort of public ledger, distributes transactions across the entire network of currency users without the need for a third party. Traditional financial transactions all require money transfers to go through a third party, making them more expensive.
But while Luther said he doesn’t believe Bitcoin or its competitors will displace the dollar, he said he believes it could be a viable option in countries like Venezuela, where their currency is hyperinflated.
Luther also said Bitcoin may get overtaken by another digital currency in the future.
“I liken it to 1998,” Luther said. “You know search engines are going to take off but which search engine? How many people would have selected Google — I would have put my money on Ask Jeeves.”
Junior Summer Burkholder, who said she didn’t know much about Bitcoin before attending the talk, thought the talk was very informative and appreciated that Luther gave both the pros and cons of Bitcoin. Still, she doesn’t plan to purchase any cryptocurrency.
“I would like to keep my money,” Burkholder said. “Maybe if I was a little richer.”
Freshman James Millius said he appreciated learning how the digital currency actually works.
“A lot of people know it as some esoteric currency that lots of people like to use,” he said. “Actually learning how the currency functions was interesting to me.”
Millius said he would buy Bitcoin, if he had more money, too.
Praxis President junior Emma McCormick said the talk was the first of five talks Praxis is holding this semester. The next will be from Steven Horwitz on inequality and income mobility in America on Feb. 22.