Bitcoin in your 401K? That's not a risk I'd take

That's not a risk I'd take

- Allison Schrager Bloomberg

I HAVE LONG been a crypto sceptic, but as it worms its way into America's financial infrastructure, it is getting harder and harder for me to maintain the argument that it will crash and burn. So I have revised my opinion. Crypto does have a future—as a speculative asset that enhances risk for gamblers, the paranoid, and less sophisticated investors, all the while diverting capital from more productive uses.

See? I told you I had changed my mind.

Something about crypto has never sat well with me. It contradicts everything I understood about money: It is volatile and hard to use, and it solves a problem there is already a better solution for: Government-issued money is pretty great. Even stablecoins, which could become a viable means of payment with new federal regulation authorised by the law President Donald Trump signed last week, can't match the dollar.

Yes, blockchain technology may prove to be a good alternative to the clunky and flawed payments system. Crypto is also a useful currency for anyone engaging in illegal transactions or living in a country experiencing hyperinflation. But these use cases do not begin to justify the price of Bitcoin, let alone all the other cryptocurrencies.