There is an old adage that counsels: “Keep your friends close, but keep your enemies closer.” The Bitcoin ecosphere has a hefty share of enthusiasts, zealots, and supporters, but there is also a loud and outspoken group of detractors that includes politicians of high rank, Nobel laureate economists, government officials, and ordinary citizens that profess a public need to protect us other folk from what they regard as a scam of the highest order that refuses to go away.
The recent Congressional hearings on Facebook’s Project Libra seemed to have opened the floodgates for every concerned citizen to voice his or her negative opinion about Mark Zuckerberg’s latest brainchild or anything remotely connected with the crypto revolution. These opinions were often misinformed and bordered on outright fear mongering, but the historical record now has an updated list of concerns that will often be quoted, when the time is right to beat upon Bitcoin or any of its altcoin brethren.
If you are ever involved in this ongoing public debate, it might be more than useful to be aware of the arguments that are being proffered by the extremists on the negative front. Disruptive technologies have always ruffled quite a few members of the “status quo”, who have a great deal invested in the current way of doing things and will vehemently resist any supposed threat to their well being, whatever the cost or public backlash.
President Trump actually got the negative ball rolling before Congress took over by tweeting:
I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity.
It was not that long thereafter when Trump’s Secretary of the Treasury, Steve Mnuchin, was declaring that cryptos were a “national security issue”. He soon echoed the sentiments of his boss by saying: “Cryptocurrencies such as bitcoin have been exploited to support billions of dollars of illicit activity like cyber crime, tax evasion, extortion, ransomware, illicit drugs, and human trafficking.”
Both men jumped upon old and outdated arguments to support their cases. New analytical tools and investigative techniques have enabled law enforcement to greatly reduce the cited “illicit activity”, but it is curious that neither man mentioned money laundering. We noted at the time:
For some reason, he neglected to mention money laundering, the one issue that global government officials from other locales have always managed to cite first and foremost. Could it be that he and his personal real estate empire are a bit more sensitive to this particular topic?
While Trump and his henchmen are at the top of the body politic, the host of other naysayers should not be ignored. For the record, here are a few choice criticisms from notable individuals that obviously did not invest in Bitcoin in its early days:
- Paul Krugman, noted economist and Nobel laureate: “Cryptocurrency enthusiasts are effectively celebrating the use of cutting-edge technology to set the monetary system back 300 years. Why would you want to do that? What problem does it solve?”
- Nouriel Roubini, economist and known as “Dr. Doom”: “Cryptocurrencies have given rise to an entire new criminal industry, comprising unregulated offshore exchanges, paid propagandists, and an army of scammers looking to fleece retail investors… Financial regulators and law enforcement agencies remain asleep at the wheel.”
- Joseph Stiglitz, American economist and Nobel laureate: “I actually think we should shut down the cryptocurrencies.”
- Warren Buffett, investment billionaire: “In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending… It doesn’t do anything. It just sits there. It’s like a seashell or something, and that is not an investment to me.”
- Bill Gates, Microsoft founder and billionaire philanthropist: “Right now, crypto-currencies are used for buying fentanyl and other drugs so it is a rare technology that has caused deaths in a fairly direct way.”
- Carl Icahn, American businessman, investor, and philanthropist: “I don’t like the cryptocurrencies only because, maybe I don’t understand them. How do you regulate them? Bitcoin and other cryptocurrencies are ridiculous, and I wouldn’t touch that stuff.”
- Jamie Dimon, the CEO and Chairman of JPMorgan Chase: He has blasted Bitcoin as a “scam” and a “Ponzi scheme and has said: “If you’re stupid enough to buy it, you’ll pay the price for it one day.” He has since recanted his statements, claiming he now sees the merit in Bitcoin… Imagine that?
And these are just a few statements from people that other people tend to listen to. Crypto supporters, forever the optimists, are willing to view such public outcries, as just one more way that cryptos are creeping into the public consciousness. In any event, Niall Ferguson, an author of a currency history book, was one skeptic that reversed his position after failing to invest in BTC in the early days. He says, “I was wrong,” and “The moral of the story is clear: When it comes to technology, pay heed to teenagers.”