Point Counterpoint: UT should not promote cryptocurrency through education

Adam Cherian, Columnist

Cryptocurrency has been gaining popularity over the past year. However, a growing number of people are critical of the way cryptocurrency is being adopted in society and the social and environmental ramifications. The amount of energy used to mine it, as well as the associated scams, show that cryptocurrency has an overall negative impact for society.

UT should divest from cryptocurrency, and teach the negative impacts of it before promoting it through education.

“We currently offer seven courses that partially or fully cover cryptocurrencies and blockchain technology,” Cesare Fracassi,  associate professor of finance, said through a spokesperson’s email. 

Cryptocurrency, a form of digital currency, has gained traction because it is secured through blockchain technology.

“You can think of it as an alternative currency. And then you can think of it as an investment, and the two are entangled,” said Dirk Mateer, an economics professor of instruction at UT.

Cryptocurrency deviating away from its original intention of being a currency is what eventually led to the explosion of non-fungible tokens (NFTs). An NFT is a digital asset in the form of any digital art. Companies like Bored Ape Yacht Club and Lazy Lions gained infamy for selling digital images of poorly drawn animals for thousands of dollars.

“I would absolutely compare it to a Ponzi scheme,” said Jeffrey Clemmons, former chair of the College Student Commission. “They have no inherent value.”

Many NFT projects promise people that it is a great investment for their future. But people are already losing interest, and NFTs are proving to be a bad investment.

NFT projects even go further as to scam everyday people in what is referred to as “rug pulls.” A rug pull is when scammers promote a digital asset like an NFT, to then drive up the price of it, only to sell and tank its value later. People have lost thousands of dollars in these transactions. 

The predatory nature of cryptocurrency projects like NFTs are not the only concern of many people. The wider environmental impact of crypto is a serious issue.

The process of attaining cryptocurrency is extremely energy intensive. To mine crypto, powerful hardware is needed. A single Bitcoin transaction, for example, can take up to 2,292.5 kilowatts of energy, enough to power the average U.S. household for over three months. This has proven to be disastrous, with Bitcoin mining surpassing the energy use of Argentina in 2020.

“I feel like if you’re going to try and institutionalize it … we have to be realistic about all of the negative aspects of it and to really think seriously and critically,” Clemmons said.

Teaching about cryptocurrency at UT may seem like the natural next step for technology so entangled in society. Professor Mateer actually encourages it. However, it is important to keep in mind the negative effects of cryptocurrency on the real world.

“Anytime that something comes along, whether it’s an NFT or crypto that people talk about … you can lever that and you can get them in classes that teach them more about personal finance, teach them more about monetary systems, how to make trades, how markets work,” Mateer said.

 Learning about the blockchain, what crypto is, and how the technology works is important, as society is moving towards utilizing this technology. However, there cannot be the promotion of crypto without looking at the negative effects on society and the environment. Having crypto initiatives and NFT promotions at UT is unethical and further contributes to the issues that cryptocurrency brings.

Cherian is a journalism junior from Round Rock, TX.

Editor’s Note: A previous version of this story misattributed an emailed quote. The Texan regrets this error.