Crypto will survive the FTX collapse – but more scandals will follow | Kenneth Rogoff

Bitcoin and ethereum prices have plummeted, but it is unlikely the US will ban cryptocurrencies soon

The epic collapse of wunderkind Sam Bankman-Fried's $32bn (27bn) crypto empire, FTX, looks set to go down as one of the great financial debacles of all time. With a storyline full of celebrities, politicians, sex and drugs, the future looks bright for producers of feature films and documentaries. But, to paraphrase Mark Twain, rumours of the death of crypto itself have been much exaggerated.

True, the loss of confidence in exchanges" such as FTX - essentially crypto financial intermediaries - almost surely means a sustained steep drop in prices for the underlying assets. The vast majority of bitcoin transactions are done off-chain" in exchanges, not in the bitcoin blockchain itself. These financial intermediaries are vastly more convenient, require much less sophistication to use and do not waste nearly as much energy.