25 Feb 2021 · 3 min read

Buffett's Partner Munger Bashes Bitcoin, Says It's 'Substitute For Gold'

Charlie Munger, the vice-chairman of Berkshire Hathaway, the chairman of the Daily Journal and the business partner of star investor Warren Buffett, has lashed out at crypto and amateur trading on platforms such as Robinhood. However, he might have helped the promoters of the "bitcoin is digital gold" narrative.

Charlie Munger. Source: A video screenshot, Youtube/Yahoo Finance

Speaking at the Daily Journal’s annual meeting of shareholders, Munger, 97, took a swipe at bitcoin (BTC), saying, per CNBC,

“Bitcoin reminds me of what Oscar Wilde said about fox hunting. He said it was the pursuit of the uneatable by the unspeakable.”

He dismissed the notion that bitcoin could become a “medium of exchange for the world,” claiming it was “too volatile to serve well.”

He added,

“It’s really kind of an artificial substitute for gold. And since I never buy any gold, I never buy any bitcoin.”

Munger waded into the ongoing Robinhood-GameStop shares debate, opining, according to Reuters,

“It’s really stupid to have a culture which encourages as much gambling in stocks by people who have the mindset of racetrack bettors. A lot of them crowd in to buying stocks on frenzy, frequently on credit, because they see that they’re going up, and of course that’s a very dangerous way to invest.”

He warned that trouble could be ahead for newer retail traders, saying that he thinks that "it must end badly, but I don’t know when."

And it appears that Munger is not the only influential business leader who has expressed his disdain for recent crypto goings-on.

The boss of European fintech firm Klarna Sebastian Siemiatkowski claimed that he was concerned about the role of Twiter in bitcoin promotion, opining that regulators needed to act to protect people from losing money.

He told CNBC,

“If I go on Twitter and search for bitcoin, I can see people writing: ‘Buy now or you’re going to miss the biggest opportunity of your life. If I [advertised] Klarna stock with similar writing I would get a fine or I would even be put to jail. I am very surprised why regulators aren’t chasing these elements.”

Munger has had run-ins with the crypto community before. In 2018, he urged Washington to “step on” crypto “hard” in a China-style crackdown. He labeled crypto as a “totally asinine” phenomenon and dismissed bitcoin as a “noxious poison.”

In 2019, he doubled down on the rage, claiming crypto project managers were fans of “Judas Iscariot.”

On Twitter, Anthony Pompliano of Morgan Creek Digital accused Munger of hypocrisy, saying that it was ironic that Munger thought Robinhood was a “dirty way to make money while he told people to take it easy on his portfolio company Wells Fargo after they were fined USD 3 billion for breaking the law” – a reference to a legal case settled last year with the American Department of Justice (DOJ).

The DOJ wrote at the time that between 2002 and 2016, Wells Fargo had been accused of “pressuring employees to meet unrealistic sales goals that led thousands of employees to provide millions of accounts or products to customers under false pretenses or without consent, often by creating false records or misusing customers’ identities.”

Pompliano bristled:

“Guess it is only dirty profits when they aren’t going in his pockets!”

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