Paul Krugman is having a Bitcoin moment

Paul Krugman has been robust of a centralized payment provider. Maybe he’ll learn something new about the value of Bitcoin.

This morning, Wednesday, March 8, the Nobel Prize-winning economist and longtime crypto skeptic took to Twitter to announce that payment app Venmo has apparently blacklisted him. And even he – one of the most famous and influential financial analysts on the planet – got no help, or even an explanation for the block, from the centralized platform’s customer service.

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It’s a delicious moment for cryptocurrency advocates. One of their self-appointed adversaries has had their pants pulled down by the exact problem they have constantly warned about: the threat of capricious, seemingly arbitrary financial censorship in the digital age.

And Venmo isn’t just any centralized payment tool: It’s one of the worst out there from a privacy perspective. Venmo makes new users’ transactions and notes public, by default, as part of its broader, deeply misguided goal of being a kind of social network for payments.

“We can do it [public by] standard because it’s fun to share [information] with friends in the social world,” a Venmo representative told CNET in 2021. “People open Venmo to see what their family and friends are up to.”

This is blatantly irresponsible, even malicious product design (although it has led to some moments of incredible comedy). Krugman’s apparent openness to using such an anti-privacy product suggests he doesn’t spend much time thinking about the problem.

But his shock at being suddenly deplatformed is even more revealing of his enduring biases. As Bitcoin advocates in his responses scramble to point out, while this may be an advantage for Americans and Europeans, it is an everyday reality for many residents of developing or unstable regions.

Shortly after the initial tweet, Krugman followed up to announce it “tweeting got results” and his account “seems[s] to be up again.” This is hardly a justification for Venmo—on the contrary, it’s a further demonstration of how much Western elite privilege is baked into dismissals of uncensorable financial tools. It’s not even clear whether Venmo representatives were able to to offer Krugman an explanation for his brief ban, highlighting the constant and opaque risks of such services.

One could also ask Krugman exactly why he was blocked from using Venmo. He himself has previously argued that “unless you’re buying drugs, assassinations, etc.,” “relying on a third party” for payments is “not a big deal.”

Personally, I have a lot of respect for Krugman’s economic commentary and his public advocacy on a wide range of topics. Here’s hoping his harrowing encounter with the real risks of financial censorship helps open his mind about crypto, too.