Uncle Charlie

20 February, 2023

In a recent article for the Wall Street Journal, Charlie Munger called for the censorship of cryptocurrencies and praised China’s communist leader for his “splendid example.”

Charlie Munger, the Vice Chairman of Berkshire Hathaway and one of the world’s most celebrated investors, has come under fire in recent years for his vehement criticism of cryptocurrencies.

Charlie Munger is a well-known figure in the world of finance, having worked alongside famed investor Warren Buffet. He is known for his acerbic wit and sharp tongue, as well as his often-controversial opinions on various topics related to business and economics. Munger is also an advocate for value investing, which involves identifying undervalued stocks and investing in them with a long-term perspective. Despite his often-contentious opinions, Munger remains a respected figure in the world of finance, with many investors seeking his guidance and insight.

Munger’s hostility towards cryptocurrencies, particularly Bitcoin, is well-documented. He has called it “stupid” and “evil” and praised Xi Jinping for being “smart enough to ban it”.

In a recent op-ed for the Wall Street Journal, Munger called for the US government to ban cryptocurrencies and lauded the authoritarian Chinese government for its hardline stance on the industry. 

This is not the first time Munger has expressed admiration for China’s totalitarian regime. Last year, when Jack Ma disappeared and was taken as a political hostage by the CCP, Munger congratulated the regime for cracking down on perceived dissent in China’s business class.

But why does Munger hate cryptocurrencies so much, and what does his hostility towards the digital assets space say about the broader social and economic forces at play?

For Munger, the problem with cryptocurrencies is that they pose a threat to the integrity of the Federal Reserve system and the US dollar. He believes that decentralized currencies like Bitcoin undermine the government’s ability to control the money supply and maintain economic stability. Munger has called Bitcoin “stupid and immoral,” and has likened it to “trading turds”, plus he keeps repeating that “it will go to 0”.

However, many experts disagree with Munger’s assessment of the situation. Some argue that cryptocurrencies could actually help to create a more stable and decentralized financial system, free from the whims of centralized institutions. 

Photo by Aditya Vyas

For example, decentralized finance (DeFi) platforms built on blockchain technology can provide access to financial services for people who may not have been able to participate in traditional financial markets. These platforms are often more secure and transparent than traditional financial systems, as transactions are recorded on a public ledger that is resistant to tampering.

Munger’s comments on cryptocurrencies have led some to speculate that he may have autocratic tendencies himself and that his criticisms of the industry are indicative of a broader trend among wealthy elites who are turning towards authoritarianism in the face of social and economic upheaval. 

In recent years, there has been a growing sense of unease among some of the world’s wealthiest people, as economic inequality continues to rise and political polarization becomes more pronounced. Munger’s praise of China‘s overbearing government, which has been accused of a wide range of human rights abuses, has only intensified concerns about the potential for wealthy elites to embrace authoritarianism in order to maintain their power and privilege.

Photo by Alyssa Kibiloski

Despite Munger’s criticisms, cryptocurrencies are here to stay. The industry has grown exponentially over the past decade and continues to attract significant interest from both retail and institutional investors. 

Major financial institutions like JPMorgan Chase and Goldman Sachs have launched their own cryptocurrency trading desks, and more and more companies are accepting cryptocurrencies as payment for goods and services. It’s clear that cryptocurrencies represent a powerful new force in the world of finance and technology, and that they will continue to play a significant role in shaping the future of our global economy.

Photo by Kanchanara

The debate over cryptocurrencies is far from over, and there will be many more unexpected twists and turns in the years to come. But one thing is certain: the rise of cryptocurrencies represents a major shift in the global financial landscape; crypto holds the potential to upend traditional economic systems in many profound ways. 

While Munger’s comments on cryptocurrencies may be controversial, they serve as a reminder that the future of money is still very much up for debate. 

I’m Bruno Calabretta, Founder at Aurora Coaching, Blockchain Development Manager at FederItaly, Crypto Coach, Web3 Expert, Public Speaker and Crypto Event Organizer. Connect with me on LinkedIn.

I am an expert in cryptocurrency but I’m not a licensed financial advisor. My thoughts about this environment are not intended to replace the services of a licensed financial advisor but instead to supplement it by giving information and opinions related to cryptocurrency’s platforms, general topics, and best practices.

I don’t believe in or endorse day-trading in crypto. Far more people lose money than make money doing this. The main rule is always the same: DYOR.