Cryptocurrency advocates often tout bitcoin as “digital gold,” but famed short seller Jim Chanos said that BTC is the “last thing” he’d want to own in a full-blown crisis.
Chanos, who rose to fame by predicting the collapse of US energy giant Enron, made this claim during a recent interview with the Institute for New Economic Thinking.
“For those who believe that you need to own digital currency as a store of value in the worst-case scenario, that’s exactly the case in which a digital currency will work the least,” said Chanos, who founded New York City-based investment firm Kynikos Associates. “The last thing I’d want to own is Bitcoin if the grid goes down.”
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“Food would work the best!,” he added, continuing:
“For those who believe it’s a store of value in the coming apocalypse, the idea is that you’re going to have to safeguard your key under a mountain with fingerprint and eye scan security while the hordes are outside your bunker trying to get in to use it — for what, I have no idea.”
Chanos chalked up the recent interest in cryptocurrencies to the fact that equities have been in a bull market for nearly a decade, causing investors to get over-excited and act against their own self-interest.
“We’re now nine years into this bull market, same as the ’90s, so I suspect that now things are starting to percolate,” he said, alluding to interest in initial coin offerings (ICOs). “This is simply a security speculation game masquerading as a technological breakthrough in monetary policy.”
Then, in an ironic twist given the name of the publication in which his comments were published, Chanos rehashed the tired — and debunked — critique that bitcoin only has utility for money launderers, tax evaders, and other people who are seeking to commit financial crimes.
“Bitcoin is still the area for people who are trying to avoid taxation or other examinations of their transactions. That’s one thing where I think it probably still has utility, but the governments have figured that out,” he concluded.