In it, he argued that gold-backed currencies caused the Great Depression.

Today, Eichengreen is criticizing a new type of asset-backed money: stablecoins — cryptocurrencies like Tether and TrueUSD that are backed one-to-one by fiat reserves.

Professor Eichengreen’s recent hit-piece in The Guardian criticizes not only these asset-backed stablecoins, but also the entire class of stable cryptocurrencies.

In his attack on Tether, Eichengreen questions why anyone would trust a controversial project with opaque physical dollar reserves over the U.S. government?

Despite the ongoing debate as to whether or not Tether has the physical dollars to back its currency, the project has nonetheless seen a meteoric rise.

It’s true that Tether is currently being used mostly by day traders (particularly on Asian exchanges) as a way to temporarily escape the volatility of Bitcoin (and increasingly altcoins) in the absence of instant or low-fee access to fiat dollars.

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