TEHRAN - A professor of applied economics at the Johns Hopkins University in Baltimore says that cryptocurrencies can’t replace currencies as they are nothing more than highly speculative assets.

Steve H. Hanke, who served on President Reagan's Council of Economic Advisers and is the world's leading expert on hyperinflation, tells the Tehran Times that "Cryptocurrencies don't, in fact, qualify as currencies."
According to Hanke Cryptocurrencies are nothing but speculative assets.
 “Bitcoin, for example, has a fundamental value of zero. And, any of the stablecoins, including tether, are not redeemable into the assets that are allegedly backing the stablecoins,” he argues.
Following is the text of the interview:

Q: How do you see the future of cryptocurrencies? Some people believe the globe is heading towards replacing paper money with cryptocurrency.

A: Your question is a complicated one to answer. As far as cryptocurrencies, as we know them today, are concerned, their future is very uncertain. Indeed, it's virtually impossible to forecast their future with any degree of certainty. 
That said, digital transactions, or what I refer to as electronic money, will become more prominent in the future. That's an easy forecast to make. After all, at present, debit cards are nothing more than digital or electronic money. Furthermore, virtually all the major central banks in the world are pursuing digital or electronic options for money. 

 Q: Given the U.S. unilateral sanctions on its foes, some countries, including Russia, are trying to remove the U.S. dollar from their trade exchanges. Don’t you think that cryptocurrencies can provide a reliable alternative for the dollar?

A: No. Cryptocurrencies don't, in fact, qualify as currencies. They are nothing more than highly speculative assets. Bitcoin, for example, has a fundamental value of zero. And, any of the stablecoins, including tether, are not redeemable into the assets that are allegedly backing the stablecoins. 

Q: Don’t you think that decentralization of money and opposing central banks’ control over currencies can push the world towards a more just global community?

A: To answer your question, one would have to define what a "just global community" is. I have no idea what you have in mind. Indeed, I suspect there would be a thousand definitions for what a "just global community" might look like. And all of them, in a strict philosophical sense, would end up, upon careful examination, to be nonsensical.

Q: Currently, the U.S. government debt is $28.5 trillion, about 29% more than the value of all goods and services that will be produced in the U.S. economy this year. Some countries blame the U.S. for weaponizing and exploiting the dollar to evade paying its debt and pressurize the others. And how can it affect the U.S. economy?

A: The U.S. government debt has exploded, reaching 128% of GDP. That's very close to its post-WWII peak. But, that's way behind Japan's debt to GDP ratio of 257%. The key to keeping in mind when observing debt ratios is the growth in the money supply. In Japan, the money supply has been growing very slowly for decades. Japan has had virtually no inflation and has been able to service its debt with no problem. Indeed, Japan has a surplus of savings in its economy, has been exporting capital, and has been consistently running current-account surpluses. When it comes to the United States, if the Federal Reserve system would slow the rate of growth in the money supply to around 6% per year, the U.S. would find that its debt would be serviced without problems. That said, I believe the U.S. fiscal deficit and debt-to-GDP ratios are way too high. Indeed, I have strongly opposed the wasteful and reckless spending that has occurred in the post-COVID period, a spending spree that's the source of the explosion in the U.S. debt-to-GDP ratio.

Q: Do you consider the U.S. economy successful in containing inflation? What can we learn from American approaches and experience?

A: Since 2001, the inflation rate in the United States has averaged 1.91% per year, which almost exactly meets the Federal Reserve's inflation target of 2% per year. So, by that standard, the U.S. has been extremely successful in hitting its inflation target. Since COVID, however, the money supply has grown at about 4 times the rate that would be consistent with hitting the Fed's 2% inflation target. As a result, inflation has started to pick up. Over the last year, the Consumer Price Index has increased by 5.4%, the highest rate since 2008. I predict that inflation will be 6-9% by the end of this year. That's why I've been advocating a serious slowdown in the growth of the U.S. money supply. The reason for that is a lesson that Milton Friedman taught us long ago: "Inflation is always and everywhere a monetary phenomenon."