European Central Bank economist published a paper stating that the continuous rise of Bitcoin will contribute to consequences such as social poverty

ChainCatcher news, according to The Block, a new paper titled "The Distribution Consequences of Bitcoin" published by an economist at the European Central Bank suggests that even with the continuous rise in bitcoin prices, early adopters will be the only beneficiaries. Latecomers and non-holders will suffer severe consequences even if there is no "bubble burst".

Economists believe that Satoshi Nakamoto's original idea of Bitcoin as a global payment system has largely failed. People are beginning to see Bitcoin as an investment asset that continues to appreciate. Economists Ulrich Bindseil and Jürgen Schaaf argue that Bitcoin "...does not generate any cash flow (like real estate), interest (like bonds) or dividends (like stocks), nor can it be used for production (like commodities). Therefore, "...most established methods for calculating or estimating fair value of assets have failed when applied to bitcoin,".

The paper points out: "The new Lamborghinis, Rolexes, villas and stock portfolios of early bitcoin investors do not stem from increased economic productivity potential; on the contrary, they are funded by reduced consumption and wealth from those who initially did not hold bitcoins." "Therefore,'missing' bitcoin is more than just losing an opportunity to accumulate wealth; compared with a world without bitcoins, it means real poverty. This redistribution of wealth and purchasing power is unlikely to occur without adversely affecting society." These harmful effects include "...corresponding poverty in other parts of society endangering cohesion stability and ultimately threatening democracy".