Nobel Laureate Krugman Dismisses Stablecoins as Criminals’ Tools While Crypto Advocates Push Back

Paul Krugman, the Nobel Prize-winning economist, has launched a scathing critique against stablecoins, calling them functionally useless outside criminal enterprises. His May 30 blog post argues these dollar-pegged tokens offer no advantages over conventional payment systems like debit cards or Venmo—except for facilitating illicit transactions.

The assertion drew immediate pushback from crypto industry figures. CoinMetrics co-founder Nic Carter countered that stablecoins provide critical infrastructure for global dollar access, particularly in emerging markets where traditional banking falters. This debate surfaces as regulatory scrutiny intensifies around Tether’s USDT and Circle’s USDC, which collectively process more daily transactions than many payment processors.

Krugman’s historical analogy comparing stablecoin issuers to ’teched-up versions of antebellum banks’ underscores his skepticism. Yet market data tells a different story: stablecoins now settle over $10 trillion annually, with usage concentrated in cross-border payments and decentralized finance protocols rather than the shadow economy.