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Cryptocurrency Criticism and How the Crypto Community Responded

With the existence of cryptocurrency comes the unavoidable cryptocurrency criticism. Most people, especially those who are not too familiar with technology, find cryptocurrency a baffling subject. In cryptocurrency’s earlier days, most people would readily label it a ‘scam’ upon hearing that it uses complex technology that is generally not related to day-to-day living. Even as we see the public’s growing interest in the world of crypto, most still find it hard to understand.

The year 2017 was witness to the public’s growing interest in the world of cryptocurrency as well as growing cryptocurrency criticism. Bitcoin, altcoins, other cryptocurrencies, and the blockchain in general have become subjects of discussion on social networking sites and internet forums.

Another manifestation of cryptocurrency’s appeal to the public is the presence of memes—pictures with captions that aim to be humorous—about them. Because the niche is subject to much speculation and discussion, it is unavoidable that some would openly criticize them.

This is understandable simply because of cryptocurrency’s intangibility. It has even been called some kind of pyramiding scam and is commonly called a bubble.
But if you think the only people who engage in cryptocurrency criticism are average people who just aren’t tech savvy, then JPMorgan Chase CEO and the real-life wolf of Wall Street prove you wrong. These giants in business have openly criticized cryptocurrency. The former called it a ‘fraud’ and said it was a waste of time.

Jamie Dimon on Cryptocurrency: A Fraud and a Waste of Time

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Dimon is Chairman, CEO, and President of JPMorgan Chase, the largest American bank. He also previously served as a member of the board of directors of the Federal Reserve Bank of New York.

Back in 2015, Dimon called cryptocurrency (Bitcoin in particular) a waste of time. Recently, Dimon again spoke against cryptocurrency, saying that people only like them because they are considered novelty. He said people only think that they are cool. Dimon further stated that as the world of cryptocurrency gets bigger and bigger, the more the government would get involved.

According to Dimon, pulling money out of thin air without regulation is very different from doing it with backing from the government. Something that is created out of nothing, in his opinion, would have no worth whatsoever.

Backlash on Dimon’s statements

As with most cryptocurrency criticism, apologists raised their voices to defend the promising technology, which we could say, is still in the early stages and have more potential than we can imagine.

Even industry leaders outside the crypto space came to criticize Dimon. A former executive of JPMorgan and head global macro Alex Gurevich reportedly told Dimon that he needs to stop talking about Bitcoin. Gurevich called Dimon a great boss and the all-time greatest bank CEO, but he is neither an entrepreneur nor a trader.

Real-Life Wolf of Wall Street on Bitcoin Being a ‘Social Experiment’

Jordan Belfort, a former stock broker and now a motivational speaker, author, and popular sales coach is now further immortalized with his open engagement in cryptocurrency criticism. Belfort was greatly popularized by the highly acclaimed Sorcese film “The Wolf of Wall Street” which was based on Belfort’s autobiography.

A part of what movie enthusiasts call Sorcese’s Greed Trilogy, “The Wolf of Wall Street” tells the story of Belfort’s rise in stock brokerage and his fall into pleading guilty to crimes of fraud, stock-market manipulation, and petty stock scams.

In a recent interview, Belfort joined cryptocurrency criticism by saying that he agrees with Dimon. Belfort said that Bitcoin is absolutely a bubble and that it is really dangerous that people are now of the opinion that cryptocurrency is the next big thing.

Belfort believes that the technology behind Bitcoin—blockchain—is the scam and not Bitcoin itself. He pointed out that technology has been used in creating a bubble and manipulation before.

Belfort also called to attention the fact that although Bitcoin and alt coins are considered currency, only a small portion is being used as such and it is generally used as an investment or security. He added that he is not saying that Bitcoin is a scam. He merely wants to point out that the price of cryptocurrency relates to nothing, echoing Dimon’s statement.

The Wolf of Wall Street Talking about Fraud

With almost everyone knowing Belfort’s history as a scammer himself, whether exaggerated or watered down by the famous movie, people just can’t help going with the petty argument of the pot calling the kettle black.

However, many still receive this criticism intelligently. Some are saying that Belfort’s statement is not as foolish as the irony makes it seem and that it is actually an informed opinion from the point of view of a real investor.

Apologists also reacted to Belfort’s statement that the biggest problem that he sees with bitcoin – and the reason why he does not trust it – is that it could easily be stolen from you. Defenders were quick to point out that the same is true with regular cash and the act of robbery. Some, of course, pointed out that the same is true when the stock market is manipulated. However, intelligent reception of this cryptocurrency criticism points out that Belfort is not wrong.

Many are of the opinion that it is up to the community and bankers who are familiar with the technology to explain it to him.

Opinions of Other Wall Street Personality

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  1. Ray Dalio
    Bridgewater Associates founder said in an interview that the bitcoin speculation, coupled with its lack of broad adoption, is preventing it from becoming a true currency. On the other hand, this is not true especially with emerging alt coins that are growing in adoption.
  2. Bill Miller
    The legendary Bill Miller does not stand by his colleagues in cryptocurrency criticism. Miller said that he is confident in cryptocurrency and fired at Warren Buffet and Jamie Dimon for their cryptocurrency criticism. He added that he is sure that not one of them has really looked into the subject.

What Does the Presence of Criticism Say?

With all these opinions from the giants and ‘experts’ in the business world, it’s hard to decide whether or not cryptocurrency would be a success in the long run. These criticism from respected people in the corporate world are just manifestations that the innovation is being taken seriously.

References:
https://www.ccn.com/fraud-bitcoin-gains-new-critic-wolf-wall-street-jordan-belfort/
https://www.reddit.com/r/CryptoCurrency/comments/72u9v4/wolf_of_wall_street_thinks_bitcoin_is_a_fraud/
http://www.foxbusiness.com/markets/2017/12/18/bitcoin-is-social-experiment-says-wolf-wall-street-jordan-belfort.html

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