“Disgusting and contrary to the interests of civilization”
“Of course I hate the bitcoin success. I don’t welcome a currency that’s so useful to kidnappers and extortionists and so forth. I think I should say modestly that the whole damn development is disgusting and contrary to the interests of civilization.” - Charlie Munger of Berkshire Hathaway.
Those were the words of ninety-seven year-old Charlie Munger, the vice-chairman of the investing giant Berkshire Hathaway, and the second-in-command to Warren Buffett.
Understandably, Munger and Buffett have amassed huge fortunes by investing in companies, by picking stocks. That they would have no need to buy cryptocurrencies is understandable. That they may not even clearly understand them is to be expected as well. But, “contrary to the interests of civilization?” Munger offers no clarification on what he means by that. And to the point that bitcoin is used by drug dealers and other criminals, yes it is. So is cash. In fact, in 2020 only an estimated 0.34%[1] of all cryptocurrency transactions involved illicit activities. Also, criminal activities[2] conducted through the traditional banking system amounted to 2-4% of global GDP, significantly more than with cryptocurrencies.
Another point Munger makes is that bitcoin is being used as a substitute for gold, and he doesn’t buy gold either, so why would he buy bitcoin? Fair enough, Berkshire is focused on companies that make profits and pay dividends. It really doesn’t, however, make this new digital technology “contrary to the interests of civilization.” Ouch.
“It’s probably rat poison squared.” - Warren Buffett, on Bitcoin.
That was Buffett’s response to Fox Business host Liz Claman when asked about bitcoin. Buffett’s sidekick Munger had previously referred to bitcoin as “rat poison.” Buffett’s
