Berkshire Hathaway's Charlie Munger Calls for Crypto Ban in the US

[Hydrogen]

Berkshire Hathaway (BRK) vice chairman and staunch bitcoin skeptic Charlie Munger has called for the United States to follow in the footsteps of China and ban cryptocurrencies.

In an opinion piece in the Wall Street Journal, Munger attributed the rise of cryptocurrencies to a gap in regulation as crypto assets aren't currencies, commodities or securities.

"Instead, it’s a gambling contract with a nearly 100% edge for the house, entered into in a country where gambling contracts are traditionally regulated only by states that compete in laxity," Munger wrote. "The U.S. should now enact a new federal law that prevents this from happening."

In 2021, Munger labelled bitcoin's (BTC) relative success, at the time as "disgusting" after alluding to how it is used by kidnappers and extortionists. A year later, the 99-year-old called bitcoin an "investment in nothing" as he doubled down on his skeptical stance.

This isn't the first time Munger or Berkshire Hathaway chairman Warren Buffett, also known as the "Oracle of Omaha," have gone after crypto with Munger even going as far to say that he wished crypto had “never been invented."

https://finance.yahoo.com/news/berkshire-hathaways-charlie-munger-calls-094144939.html

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I never understood how wealthy and successful men can sound so negative at times:

This isn't the first time Munger or Berkshire Hathaway chairman Warren Buffett, also known as the "Oracle of Omaha," have gone after crypto with Munger even going as far to say that he wished crypto had “never been invented."

For successful billionaire investors to say they wish crypto had never been invented. This sounds serious! Is crypto a big deal for them? Why would such be the case?

I get that millennials, generation Z and the youth demographic love crypto and have been known to throw their money at it in the hope of someday becoming millionaires.

Warren Buffett and Charlie Munger want investors and the youth demographic to throw all their cash at stocks instead. To keep stock indexes rising and make berkshire hathaway a more profitable venture.

Buffett and Munger are upset all of the liquidity directed towards crypto, isn't being thrown at things they own to make them richer. But what would they do if they had additional billions at their disposal? Would it make a significant change to their lifestyle, net worth or holdings?

What if Warren Buffett and Charlie Munger both had $200 billion dollars more than they have now. Wouldn't they be saying the exact same thing, doing the same thing they are right now? In which case, why be upset when it wouldn't have a noticeable effect on their lifestyle or standard of living?

[jackg]

Surely the point in sounding negative is to get melleniels, boomers and gen x to give up on the idea of investing in cryptocurrency and move to investing in stocks.

"100% house edge" is also not something that makes sense. Did they try investing (with a tiny amount) at its peak and are now disappointed they've lost. Are they worried it gives a whole new precident on how people are more solvant than companies in the sector (ftx and others v retail investors). Warren Buffet does claim to prefer investments in the production of assets rather than investments in the underlying asset so it would make sense why they don't like bitcoin.

[darkangel11]

There's a guy that I like to read or listen to on youtube, whose name's Matthew Kratter. Look him up and you won't regret if you're a bitcoin supporter but don't really like altcoins too much. He's got that sarcastic, yet informative way of talking about all the attacks on bitcoin from banks, old farts, scammers and politicians. He's got a video about these two old donkeys: Warren Muppet and Charlie Muppet, as he calls them.

Hydrogen pretty much answered the question as to why these guys are against bitcoin. They read about crypto millionaires and feel like the young generation didn't put enough effort into this. They didn't have to do analysis, set up companies, take loans. They just did a few clicks on their computers in 2012 or 2013 and 5 years later were millionaires. That's how these old people see them, like the millenials are making money out of nothing.

Sad news for you Muppets. In 10 years bitcoin will be worth $200k+, there will be a lot of young people running around in bitcoin t-shirts with hardware wallets in hand, but you won't live long enough to see it. If you do they'll be feeding you through a tube (Charlie is going to be long gone by then, he's 99, so this bitcoin rant is his last stand).

Bottom line, I wouldn't focus on what these old guys are saying. There's a 50/50 chance that they'll live to see the next halving.

[Knight Hider]

For successful billionaire investors to say they wish crypto had never been invented. This sounds serious! Is crypto a big deal for them? Why would such be the case?

They fear crypto. Crypto doesn't feel fear nor care.

--Knight Hider

[Broly46]

He failed to said a few points, after screwing up many guys of their lifesaving, punting into stock market mindlessly in the name of WB the life saviour and his famous books teaching guy to fish, over the last 50 years since 1971. He finally wish "crypto have never been invented." Also he failed to said stock market is not investment into nothing, crypto is the bad. He also failed to said stock is not a gambling contract with nearly 100% edge for the house, crypto is the bad. He also failed to said he wish all the young guy would never realise many lies he failed to said. He also failed to said he wish all of them fall into his trap. He also failed to said he fear of not able to be the house with nearly 100% edge in crypto market. He also failed to say his comfort zone is Berkshire where he is the house with near 100% edge in stock market. Is he the hypocrisy? Is he the narcissist?

[Gyfts]

It isn't too unusual for the old institutional investors to disparage Bitcoin. A lot of these guys made their money with traditional securities and they're unwilling to recognize technological changes in the market because the bulk of their money was made in the past.

It's always amusing the mental gymnastics these people will go through -- if Munger suggests Bitcoin is nothing but gambling with a 100% house edge. Who exactly is the house?

[hatshepsut93]

He's right, a typical shitcoin is much closer to a HYIP/ponzi scheme than a currency or commodity, because it's centralized and created with the sole purpose of defrauding investors, while investors only buy it speculatively.

But Bitcoin is nothing like that, it doesn't have some centralized "developer" that runs all the marketing, exchange listing, solicitation and sells the pre-mined coins. Bitcoin is indeed a currency/commodity/asset (pick whichever you like), Buffet may hate it for not having clear fundamentals, but he's gotta try a different argument to ban it, instead of branding it as "gambling contract".

[mk4]

Both Warren Buffett and Charlie Munger would simply not understand the importance of bitcoin/crypto simply because they're in a privileged country, and the fact that they're privileged in general. That, and they don't get technology at all. I could almost guarantee that with Bitcoin, they think we're just buying and selling digital trading cards and such; minus all the advantages of bitcoin like decentralization, etc.

[yhiaali3]

I was not very surprised by this saying when I learned that he is over 90 years old. These old people do not accept new things, and they cannot accept the idea that young people get a lot of money without making a lot of effort or investing a huge capital.

Yesterday, there were also statements by the manager of JPMorgan, but they lost any effect on Bitcoin. On the contrary, we found a great recovery in the market despite all these negative statements.

I think they missed the train and couldn't catch it anymore so they keep shouting to no avail. There is a popular proverb in my country that applies to this case, but I will not say it here out of respect for their age.

[coolcoinz]

I was not very surprised by this saying when I learned that he is over 90 years old. These old people do not accept new things, and they cannot accept the idea that young people get a lot of money without making a lot of effort or investing a huge capital.

99 is not just over 90, for most people that's a vegetative state. My father is 85 and I have to often repeat things to get him to understand. He doesn't use a computer, needs a phone with speed dial to call people. I'm saying this because I don't believe Charlie's words are his own. People like that need help getting in and out of bed. He must have people who get him dressed every day and press buttons in the elevator for him. He must also have people who tell him what to say and when.

Having an old father and knowing some of his old friends I can tell you that old people get bitter and they look for arguments just to show they can still argue. Charlie talks about bitcoin because there are people willing to argue with him about it.

[adaseb]

The amount of gibberish that comes out of his month is just crazy. Some of his speeches weren’t bad in the past when the came to investing but when it comes to cryptos he really gets upset whenever talking about it.

Seems like a nerve is struck whenever either of them are talking about cryptos. They are already rich and probably don’t care they missed the boat on buying cheap bitcoins at $100 a coin. So why are they doing this? Most likely cryptos won’t get banned just because he says so.

[Kakmakr]

I don't know why you are surprised that old people like Warren Buffett and Charlie Munger are still grinding teeth about Crypto currencies. The old people believe everything they have done before are better than what the new generation are doing.... and they will never agree that new strategies and technology are better. 

It is understandable that they are loyal towards the financial tools and strategies that made them filthy rich, but don't shit on the younger people for trying something new. Also.... most older people resist change... and Warren Buffett is 92 years old and Charlie Munger is 99 years!!!

So, time is not on their side .... 

[The Sceptical Chymist]

I respect both Munger and Buffett's opinions and their intelligence, even though I disagree with them about crypto.  Even hardcore bitcoiners probably shouldn't discount what they say or dismiss it out of hand. 

What I don't understand about Munger's statement here is the part where he says the house always has a 100% edge with respect to crypto.  Anyone understand what he means by that?  And his argument that bitcoin is used by criminals....well, that's been discussed so many times here over the years and it's been demolished every time by comparing it to fiat.

I think the media is just seeking Munger's opinion on crypto to make salacious headlines and stir up the shit, because they know what his position on them is quite well.  But bash away.  Bitcoin will still be here after he's dead.

[mk4]

What I don't understand about Munger's statement here is the part where he says the house always has a 100% edge with respect to crypto.  Anyone understand what he means by that?

I'm definitely not 100% sure, but if I were to guess he's referring to exchanges when he said "house". I mean, there's some truth to that in a sense that the casino always wins, but his statement is a huge over-generalization.

[Lucius]

~snip~
I think the media is just seeking Munger's opinion on crypto to make salacious headlines and stir up the shit, because they know what his position on them is quite well.  But bash away.  Bitcoin will still be here after he's dead.

This is something that is known to everyone who has followed these two, because their views on Bitcoin regularly appear in the media, even though it has long since become pointless to read about it. It's fascinating how much it matters to people what people like Munger, Buffett, Musk, Gates and the like think about Bitcoin - and it's even more fascinating that despite everything some people persistently want them to change their minds.

I can understand to some extent that people like you have certain sympathies for these people because you live in the same country, but they were never important to me, and even less when they started poisoning the public with their statements about Bitcoin. Unfortunately, their opinion as very influential people has a significant influence on the formation of public opinion, and to me that is much more important than anything else.

However, as you yourself conclude, their time is slowly running out, and one thing is certain - Bitcoin will outlive them and in the future prove that both of them were wrong.

[avikz]

Not surprising at all! When the founder of Berkshire Hathaway is always very negative about bitcoin, do the Vice chairman have the audacity to contradict him? I guess no! So it's no surprise that he is playing the same broken record. Then we have media houses whose bread and butter depends on the buzz they can create. So they are just utilizing the opportunity.

When he says that there's 100% edge of the house - it clearly shows that he doesn't quite understand what decentralisation is and how it works! 

[o48o]

-cut-
I never understood how wealthy and successful men can sound so negative at times:
-cut-

I am guessing that when your net worth is dropping rapidly and you have to watch people investing billions in a cryptocurrency with an ape or a doge picture instead of your old man scams is quite insulting to fragile ego. But seriously gladly no one needs to care what horse industry thinks about auto industry taking their money.

[so98nn]

When you know you are out of race and it’s too late to do anything about it: the wealthy: YES.

Any social freak would understand what that Yes means above. I’m not sure what’s happening in the economy class right now but the real world is giving really shit ideas to the young peeps and to those who are learning from the oldest.

If things kept like this, the news Corner might need to be suppressed from the world to move the economics to right direction.

Initially it was threat from the local authorities, then it started from different summits, governments etc and now here we are someone from another country is trying to tell another country to ban crypto by referring the another countries failure. That’s broken world.

[Fortify]

I never understood how wealthy and successful men can sound so negative at times:

This isn't the first time Munger or Berkshire Hathaway chairman Warren Buffett, also known as the "Oracle of Omaha," have gone after crypto with Munger even going as far to say that he wished crypto had “never been invented."

For successful billionaire investors to say they wish crypto had never been invented. This sounds serious! Is crypto a big deal for them? Why would such be the case?

I get that millennials, generation Z and the youth demographic love crypto and have been known to throw their money at it in the hope of someday becoming millionaires.

Warren Buffett and Charlie Munger want investors and the youth demographic to throw all their cash at stocks instead. To keep stock indexes rising and make berkshire hathaway a more profitable venture.

Buffett and Munger are upset all of the liquidity directed towards crypto, isn't being thrown at things they own to make them richer. But what would they do if they had additional billions at their disposal? Would it make a significant change to their lifestyle, net worth or holdings?

What if Warren Buffett and Charlie Munger both had $200 billion dollars more than they have now. Wouldn't they be saying the exact same thing, doing the same thing they are right now? In which case, why be upset when it wouldn't have a noticeable effect on their lifestyle or standard of living?

In a free country he is entitled to have such an opinion but really at his age should not be able to dictate laws or general government direction. By their own admission Warren and Charlie missed many good ideas in the tech sectors because they made their wealth without relying on this sector and they never wanted to learn it either. They can certainly express their opinions on whether they think it is a good or bad thing, along with the reasoning, but should not be making calls like this. It's better for their business if they keep out of politics like they have for most of their lifetimes and focus on enjoying the later years in life. There is definitely room for improvement in crypto, but bans rarely help and stifle progress.

[Hispo]

Both Warren Buffett and Charlie Munger would simply not understand the importance of bitcoin/crypto simply because they're in a privileged country, and the fact that they're privileged in general. That, and they don't get technology at all. I could almost guarantee that with Bitcoin, they think we're just buying and selling digital trading cards and such; minus all the advantages of bitcoin like decentralization, etc.

Spot on.
They are people who have never worried about living in a developing country and depending of a third party foreigner app to store one's little savings and transfer money. They are people who see no problem using Paypal and paying imposed fees that can get up to a few dollars, they do not even think that friction through transactions could prevent someone from buying an extra kilogram of rice for their family.

We talk a different language that those rich men in suits, they live in a different world where all is perfect and people do not need decentralization.