Charlie Munger made a startling comment on cryptocurrencies at a recent conference as he praised China for banning crypto for good. The ultimate investor Charlie Munger says that cryptocurrency is nothing but a joke and a vehicle that is destined to crash, and those who will be chartering this vehicle would also meet the same fate. He also shares a very hard stance against cryptocurrencies, decentralization, and every associated digital asset such as non-fungible tokens and exchange-traded funds, and he also said that he wishes cryptocurrencies would never have been invented in the first place.
He said crypto is a bad idea on various fronts, and people should understand this, it sure looks like a lucrative opportunity at first, but when you start to enter more deeply into this space, you do unravel the heart-clenching volatility which is there at the core of this whole initiative. Charlie Munger is the vice-chairman of Berkshire Hathaway and an esteemed partner of Warren Buffet; he is an extremely experienced investor and has years of experience under his belt. It is not like he is making these accusations out of thin air but has solid judgment behind it.
High Volatility of Cryptocurrencies
He also iterated on the fact that how extreme was the dot com boom and how crazily it went under. Cryptocurrencies and decentralization are nothing but a remade copy of the same boom which resulted in a market-wide collapse and crashing the economy on a global scale. If it wasn’t for the extreme volatility with these cryptocurrencies, sure, maybe the stance of Charlie wouldn’t be as weird as it is now. It is the volatility that makes cryptocurrencies a doomed investment initiative, and people who think they are going to make a quick buck out of it are really mistaken.
He also has problems with cryptocurrencies on their use case as these don’t have any centralized oversight on them, which is why they are used by kidnappers, extortionists, and also in money laundering, or so Charlie says, and that is why it is not a practical mode of a financial instrument at all.