The many millions spent on Super Bowl ads notwithstanding, it’s been a rough week for bitcoin and its fellow cryptocurrencies. Which means it’s a perfect time for some of its longtime enemies to do some piling on.
Let’s start with Berkshire Hathaway Vice Chairman Charlie Munger. Offering a preview what’s in store for Buffett devotees in two months’ time, Munger managed to outdo himself, and that’s saying something, given that he’s previously called digital currencies “worthless artificial gold” that is demented, disgusting, disgraceful, anti-social, stupid and immoral, and the equivalent of trading turds or “freshly harvested baby brains.”
“I’m proud of the fact that I avoided it. It’s like some venereal disease or something,” Munger said. “I just regard it as beneath contempt. Some people think it’s modernity and they welcome a currency that’s useful in extortions and kidnappings and so on and so on, tax evasions….”
“I admire the Chinese for banning it. I think they were right and we’ve been wrong to allow it,” Munger added.
And, on the bright side of an otherwise very dark situation, any future authoritarian government of these United States might have the gumption to finally do what the authoritarian Chinese government did.
“Inflation is a very serious subject, you could argue it is the way democracies die….” Later on Wednesday during the annual meeting of the Daily Journal corporation, Munger’s publishing and technology company, he expanded on his inflation comments noting that he didn’t know how it would all work out in the U.S. context “but we are flirting with serious trouble.”
And, as a result, he doesn’t think much of fiat currencies, either, at least if you plan to live as long as he has.
“I think the safe assumption for an investor is that over the next hundred years, the currency is going to zero," he said. "That is my working hypothesis.”
Anyway, back to those Super Bowl commercials. Senate Banking Committee chief Sherrod Brown saw them. And the combination of them and watching his home-state Bengals go down to defeat put him in one seriously bad mood.
“The fact that these companies felt the need to advertise at all is a bit of a giveaway about one of their major claims,” Brown said at the hearing. “If this were actually meant to be used as currency, why would you need to buy ads?"
“I don’t think I’ve ever seen, in 40 years of Super Bowl watching, the Federal Reserve buy a multimillion-dollar commercial for US dollars,” he added. “That’s because crypto isn’t money. It’s designed for speculation….”
“The ads left a few things out. They didn’t mention the fraud, scams, and outright theft,” Brown added. “The ads didn’t point out that you can lose big in crypto’s huge price swings. They didn’t tell you about the high fees pocketed by the crypto companies.”
The Financial Stability Board doesn’t think much of them, either:
“Crypto-asset markets are fast evolving and could reach a point where they represent a threat to global financial stability due to their scale, structural vulnerabilities and increasing interconnectedness with the traditional financial system,” the report said…. “Were a major stablecoin to fail, it is possible that liquidity within the broader crypto-asset ecosystem (including in DeFi) could become constrained, disrupting trading and potentially causing stress in those markets. This could also spill over to short-term funding markets if stablecoin reserve holdings were liquidated in a disorderly fashion.”
Berkshire Hathaway’s Charlie Munger compares crypto to ‘venereal disease’ [N.Y. Post]
Inflation can be ‘the way democracies die’: Charlie Munger [Yahoo!]
‘Crypto isn’t money’: Super Bowl cryptocurrency ads slammed by top Senate Democrat [N.Y. Post]
Crypto Could Derail Financial Stability, Global Financial Watchdog Says [CoinDesk via Yahoo!]
Bitcoin price below $44,000 as regulation calls get louder [Fox Business]
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