Author:
Charlie Munger, the Vice Chairman of Berkshire Hathaway and Warren Buffett’s right-hand man, reiterated his stance against Bitcoin and the entire crypto industry.
This time, the American billionaire investor urged the United States government to ban all cryptocurrencies as they are bound to cause more harm than good.
Munger Attacks Again
In an opinion published on mainstream media, the Wall Street Journal (WSJ), Munger argued that unvetted private companies are issuing thousands of cryptocurrencies, citing the gap in crypto regulation in the U.S. as a reason for that.
These digital assets have become publicly traded without governmental pre-approval of disclosures and pose a risk to the country’s economic health.
The billionaire investor likened such a level of capitalism to a remark attributed to renowned American writer Mark Twain: “A mine is a hole in the ground with a liar on top.”
While blaming the government’s lack of regulation, Munger argued that such digital assets were neither currencies nor commodities and securities. He classified cryptocurrencies as gambling contracts in a country where they are traditionally regulated by “states that compete in laxity.”
The Berkshire vice-chairman insisted that the U.S. enact a new federal law to ban cryptocurrencies and prevent such incidents from continuing.
An Example of “Uncommon Sense”
To support his point, Munger cited two precedents. The first was the case where China’s communist government recently banned cryptocurrencies. He called it a wise decision as they knew that such currencies would cause more harm than good.
Furthermore, the Bitcoin critic mentioned an incident in England in the early 1700s where the country banned all public trading in new common stocks. The ban resulted from a shattered plan that involved amassing profits by using slow-moving sailing ships to trade with the poor.
The ban was enforced for about 100 years, and according to Munger, this made England contribute the most to the march of civilization.
“What should the U.S. do after a ban of cryptocurrencies is in place? Well, one more action might make sense: Thank the Chinese communist leader for his splendid example of uncommon sense,” Munger added.
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