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Warren Buffett's Berkshire Hathaway vice chairman Charlie Munger, known for his disdain of cryptocurrencies and blunt remarks, has once again launched a scathing attack on Bitcoin and other cryptocurrencies in a recent interview with The Wall Street Journal.
Charlie Munger: Cryptocurrencies Are Destructive and Unproductive Inventions
As a critic of cryptocurrencies, the 99-year-old Charlie Munger has consistently held a negative view of crypto assets, considering them a "destructive" and "unproductive" financial invention. He likened the introduction of Bitcoin to throwing a "stink bomb" into the refined formula of traditional finance.
Charlie Munger emphasized the importance of "hard money" in transitioning from primitive societies to advanced civilizations, highlighting that the durability of currency, whether it's seashells or gold coins, has always been crucial. He further explained that Bitcoin, as a "man-made" currency, disrupts the financial system that has long effectively served.
In addition to discussing cryptocurrencies, Charlie Munger, a proponent of value investing, once again advised that the best approach for ordinary investors might be to put their money into index funds (ETFs). He compared it to how someone wouldn't design their household appliances without expertise, and similarly, there's no reason for individuals to select individual stocks unless they have a clear advantage.
Charlie Munger had previously criticized cryptocurrencies, asserting that they aren't what people perceive as currencies, commodities, or securities but are, in fact, "DB contracts" where dealers have almost 100% of the advantage. He urged the need for new federal laws in the United States to prevent risks, citing the recent issuance of thousands of new cryptocurrencies by private companies without any prior approval from authorities.
In these cases, issuers have gained control of these tokens at very low costs, while the public has bought them at considerably higher costs without being aware that it's in the issuer's favor.
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Post time 11-11-2023 06:56:42