Charlie Munger, vice chairman of Berkshire Hathaway, called cryptocurrency “worthless” during the annual shareholder meeting of the Daily Journal Corporation, where he is a director. He went on to refer to it as “crypto crappo” and “crypto s—,” and described it as “totally absolutely crazy, stupid gambling.” Munger, who is a longtime stock investor with a net worth of $2.3 billion, said that anyone who opposes his position on cryptocurrency is an idiot and that there is no rational argument against his position.
Cryptocurrency’s advocates argue that digital assets offer privacy, security, better transaction speeds, and lower costs than traditional financial institutions. However, Munger remains unconvinced.
Munger’s comments come amid challenges for crypto investors over the past year. The crypto market lost roughly $2 trillion in 2022, with Bitcoin, one of the most popular cryptocurrencies, losing more than 60% of its value. Additionally, the implosion of FTX, a now-bankrupt crypto trading platform once valued at $32 billion, has shaken investors’ confidence in the industry.
Regulators have also increased scrutiny of crypto-trading firms and investment advisors. The U.S. Securities and Exchange Commission’s (SEC) “2023 Examination Priorities Report” outlines increased focus on the offer, sale, recommendation, or advice regarding trading in crypto or crypto-related assets.
The SEC also voted to expand federal rules that would require crypto exchanges to hold their assets with a federal- or state-chartered bank to act as a custodian over customers’ virtual currency. The proposal puts crypto firms in a “no-win” scenario, as U.S. regulators have warned banks that dealing with crypto exposes them to an array of risks, including fraud and scam.
Munger has previously called for the U.S. government to ban cryptocurrencies and expressed disappointment in his country “for allowing this crap.” As the crypto industry faces rising regulatory crackdowns, Munger may partially get his wish.
Despite the claims of cryptocurrency’s advocates, Munger remains unconvinced of the value of virtual currency, referring to it as “ridiculous” and “stupid gambling.” With increasing regulatory scrutiny and challenges in the market, the future of cryptocurrencies remains uncertain.
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