[Asia Economy Reporter Kim Min-young] Paul Krugman, Nobel Prize-winning economist and professor at the City University of New York, recently compared the crash in virtual asset prices to the 2008 subprime mortgage crisis depicted in the film "The Big Short," calling it a "Big Scam."
In an op-ed for the New York Times on the 6th local time, Professor Krugman criticized the recent collapse of Korean stablecoin TerraUSD (UST) and others that plummeted last month.
He explained that in 2008, people did not bet against the housing market bubble because it was hard to believe that $6 trillion worth of real estate assets would vanish and that mortgage-backed securities (MBS) investors would lose $1 trillion.
He then analyzed that the current situation in the virtual asset market is similar.
Professor Krugman fundamentally found it difficult to justify the existence of stablecoins, stating that stablecoins are only used for illegal purposes such as money laundering and play no role in everyday business transactions.
He noted that the total market capitalization of virtual assets reached $3 trillion during the boom in November last year, saying, "It may seem extreme and unbelievable that such a large asset class has no value."
He added, "But I remember the housing market bubble and the subprime crisis," and pointed out, "It seems we have gone from 'The Big Short' to the 'Big Scam.'"
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