Billionaire Charlie Munger: Cryptocurrency is 'crazy, stupid gambling,' and 'people who oppose my position are idiots'
Billionaire investor Charlie Munger isn't a fan of cryptocurrency.
The Berkshire Hathaway vice chairman called the form of virtual currency "worthless" during Wednesday's annual shareholder meeting of the Daily Journal Corporation, a publishing company where he's a director.
"Sometimes I call it crypto 'crappo,' sometimes I call it 'crypto s---.' It's just ridiculous that anybody would buy this stuff," Munger, 99, told CNBC's Becky Quick during a livestream of the event, adding: "It's totally absolutely crazy, stupid gambling."
Cryptocurrency's advocates maintain that digital assets offer privacy, security, better transaction speeds and lower costs than traditional financial institutions.
But Munger, a longtime stock investor with a net worth of $2.3 billion, doesn't buy it. "I think the people who oppose my position are idiots, so I don't think there is a rational argument against my position," he said.
Munger's comments come amid an avalanche of problems for crypto investors over the past year.
The crypto market lost roughly $2 trillion last year. Bitcoin, one of the most popular cryptocurrencies, lost more than 60% of its value in 2022. And the implosion of FTX, a now-bankrupt crypto trading platform once valued at $32 billion, has shaken investors' confidence as the industry feels the ripple effects of the company's collapse.
"Many Americans are coming to realize that cryptocurrency is just a speculative mania and the industry is rife with crooks," James Royal, a principal reporter at Bankrate, tells CNBC Make It. Indeed, just 8% of Americans have a positive view of cryptocurrency as of November, according to the CNBC All-America Economic Survey.
On Wednesday, Munger said he's not proud of his country "for allowing this crap." He's previously urged the U.S. government to ban cryptocurrencies, and may partially get his wish as the crypto industry faces rising regulatory crackdowns.
Increased scrutiny of crypto-trading firms and investment advisors are among the U.S. Securities and Exchange Commission's top priorities this year, as outlined in the agency's "2023 Examination Priorities Report."
The SEC's examinations will focus on the "offer, sale, recommendation of or advice regarding trading in crypto or crypto-related assets," the report says.
The agency voted Wednesday to expand federal rules that, if passed into law, could 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, SEC commissioner Mark Uyeda wrote in a statement on Wednesday. U.S. regulators have already warned banks that dealing with crypto exposes them to an array of risks, including fraud and scam.
"In other words, an adviser may custody crypto assets at a bank, but banks are cautioned by their regulators not to custody crypto assets," Uyeda wrote.
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