- Charlie Munger slammed the rampant hype, lack of regulation, and unfairness of cryptocurrencies.
- Warren Buffett's right-hand man urged the US government to ban the fledgling industry entirely.
Investing icon Charlie Munger has trashed the cryptocurrency industry as speculative, unregulated, and predatory, and called for the US to ban it altogether.
Warren Buffett's business partner and the vice-chairman of $4 took aim at the likes of bitcoin, ether, and dogecoin in a Wall Street Journal op-ed titled "$4," published on Wednesday.
The 99-year-old billionaire noted that thousands of cryptos have become publicly traded with little or no government oversight. Some crypto businesses have handed large amounts of virtually free coins to promoters, in return for them coaxing the public into buying in at much higher prices, he said.
Munger bemoaned the "wild and woolly capitalism" at play. He compared it to mining, where salesmanship is often key to convincing investors to finance digging for precious metals that may not exist.
"Such wretched excess has gone on because there is a gap in regulation," he said. "A cryptocurrency is not a currency, not a commodity, and not a security. Instead, it's a gambling contract with a nearly 100% edge for the house."
"Obviously, the US should now enact a new federal law that prevents this from happening," Munger added.
The veteran investor pointed to two precedents. The first was the Chinese government banning crypto trading in 2021, citing concerns of crime, financial instability, and environmental damage. The second was the English Parliament's Bubble Act 1720, which clamped down on stock trading after the $4.
Munger suggested that once the US bans crypto, it might consider thanking Chinese leader Xi Jinping for his "splendid example of uncommon sense."
Buffett's right-hand man has been waging a public crusade against crypto for years. He has $4 the industry as "partly fraud and partly delusion." He's also compared crypto to "$4," a "$4," and an "$4," and said he $4 a crypto executive to marry into his family.
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