Crypto currency

Bitcoin will not become a global medium of exchange, says Charlie Munger


Like Berkshire Hathaway chairman Warren Buffett, 97-year-old Charlie Munger is a known critic of Bitcoin (BTC).

Addressing the 2021 Daily Journal annual meeting with shareholders organized by Yahoo Finance on Wednesday, Munger again espoused some negative sentiments about the largest cryptocurrency by market capitalization.

Fielding questions from shareholders concerning Bitcoin, Munger stated:

“I don’t think Bitcoin is going to end up [being] a medium exchange for the world. It’s too volatile to serve well as a medium of exchange.”

Compared with Munger’s previous comments about Bitcoin, his remarks during the meeting appeared watered down. Indeed, Munger once said that Bitcoin investors were celebrating the life and work of Judas Iscariot.

During the 2018 edition of the Daily Journal annual meeting, Munger characterized cryptocurrencies as “totally asinine” and called professional crypto traders “disgusting.”

At Berkshire Hathaway’s annual meeting in 2018, Munger likened the crypto market to “trading turds.” At that same event, Buffett would render his infamous “rat poison-squared remark” about Bitcoin.

With development work on scaling solutions like Lightning Network and sidechains still in progress, the jury is still out on whether BTC will ever function efficiently as a medium of exchange.

However, the case of Bitcoin as a store of value appears significantly stronger, despite assertions to the contrary by critics like Nouriel Roubini and gold bug Peter Schiff. Munger also touched on BTC being like gold on Wednesday, adding:

“It’s really kind of an artificial substitute for gold and since I never buy any gold, I never buy any Bitcoin, and I recommend other people follow my practice.”

The Berkshire Hathaway vice-chairman did not waste the opportunity to drop an anti-Bitcoin soundbite, quoting Irish poet and playwright Oscar Wilde by comparing BTC to fox hunting. “It’s like what Oscar Wilde said on fox hunting: the pursuit of the uneatable by the unspeakable,” Munger quipped.

Buffett’s right-hand man also dismissed the idea of the Daily Journal emulating companies like Tesla in adding Bitcoin to its balance sheet.

As part of his comments at the event, Munger also waxed lyrical about mainstream finance saying that “a properly run bank is a great contributor to civilization.”