Saudi billionaire Prince Alwaleed bin Talal has joined the high-profile chorus slamming Bitcoin. “Bitcoin is Enron in the making. It will implode”, he said.
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‘It’s Going to Implode One Day’ Says Prince Alwaleed
Prince Alwaleed believes bitcoin is a bubble. He joins the long list of influential people that have recently the popular digital currency. The prince, who has a flair in investing into many technology companies such as Twitter and AOL, takes the side of JPMorgan Chase CEO Jamie Dimon.
While cryptocurrency continues to set record price highs, there are many lambasting the non-fiat digital assets. Alwaleed, in an interview with CNBC, said:
“I just don’t believe in this Bitcoin thing. I think it’s just going to implode one day. I think is Enron in the making, It just doesn’t make sense. This thing is not regulated, it’s not under control, it’s not under the supervision of any central bank.”
A few weeks ago, Dimon had called the currency a “fraud” and referred to people investing into it as “stupid”. Alwaleed added he was “in agreement with Jamie Dimon” for opposing the currency.
Alwaleed’s comment came after the Saudi Monetary Agency, country’s financial regulator, said it’s still premature to judge Bitcoin’s effect. Abdulmalik Al-Sheikh, chief mentor at Saudi Arabia Monetary Agency said: “I think it’s about another five years before we can really see whether there is a real impact on the currencies in general.”
Bitcoin Is Enron in the Making
Enron is one of the largest accounting scandals ever witnessed in the United States. Enron, an energy firm that was once a Wall Street favorite, later hit rock bottom and collapsed in 2001.
The growth of Enron was obtained via accounting loopholes which eventually landed executives behind bars. Alwaleed compares Bitcoin to the Enron scandal that failed many. He indicates that the cryptocurrency bubble is going to end badly.
Many other financiers are skeptical about the currency. Ray Dalio, the founder of Bridgewater Associates, said bitcoin is nothing but a bubble. Bridgewater Associates is world’s largest hedge fund. Jamie Dimon compared the digital currency to the 17th-century market bubble “tulip mania”.
Certainly, to Bitcoin supporters and cryptocurrency enthusiasts, these doubts often look like features rather than defects. In 2017, it rose about 500 percent, crossing the $6,000 mark for a single BTC.
However, not all Wall Street financiers are skeptical about the cryptocurrency. James Gorman, Morgan Stanley CEO, last month commented the phenomenon was “more than just a fad.”
Alwaleed, who is a major investor in many global companies like Citigroup and Four Seasons, doubts the currency altogether. His company Kingdom Holding, a massive conglomerate based in Riyadh, Saudi Arabia has also in the past invested into Apple and Twitter.
His remarks on Bitcoin land in the same camp as Dimon’s comment “governments are going to crush it”. However, with many countries approving the currency, the battle on it seems far from over. Yet many believe that the digital currency will not flourish without backing by the governments.
… And Bitcoin Proponents
Internet entrepreneur Kim Dotcom joked on Twitter by referring Prince Alwaleed as “more like Prince Alt-Delete”. Dotcom indicated that the billionaire prince also mocked Donald Trump as a “disgrace to America”, doubting he could win the U.S. presidential election. However, after Trump’s victory, he quickly switched his tone.
The list of skeptics is never-ending, although many financiers are softening towards Bitcoin.
Billionaire investor Mark Cuban considers the cryptocurrency as like baseball cards. Additionally, he advised true adventurers to invest 10 percent into high-risk cryptocurrencies. Mark, Yusko, hedge fund manager, forecasts the bitcoin price to reach $1 million USD in 20 years.
Does Prince Alwaleed have a point? Let’s hear your thoughts.
Images via BBC, Wikipedia