Kevin O’Leary, notable host of the TV investment show Shark Tank, recently spoke on CNBC’s Squawk Box on how cryptocurrencies are still rogue. He believes they are incompatible with the current regulatory environment and will thus fail.
According to Kevin O’Leary, most institutions have no interest in dealing with cryptocurrencies due to compliance being too difficult. Harshly criticizing the industry, he says mass institutional adoption for cryptocurrencies will not happen due to the risk being too high. He voiced his criticisms on CNBC’s Squawk Box recently.
— Squawk Box (@SquawkCNBC) July 3, 2019
O’Leary, in case you were wondering, is no fan of cryptocurrencies. His main criticism is that the space lacks regulation, and there being no unified compliance standard means that the industry has ‘gone rogue.’ “I don’t want to be involved in a drug dealer trading in Bitcoin somewhere,” he said.
Ultimately, what O’Leary wants is a cryptocurrency which can easily be traded for sovereign currencies, and one which can be used to pay taxes, make investments and buy equities.
However, it seems that O’Leary is misunderstanding what the underlying technology behind Bitcoin and other cryptocurrencies is all about. It’s not just about creating an accessory to the current monetary system. Instead, it’s about creating decentralized networks free from politics, state-censorship, and claims of ownership. If cryptocurrencies are merely intended to be an accessory to our current monetary system, then what is the point of it to begin with?
O’Leary says that he is waiting for the industry to “grow up” so he can play “real baseball there.” However, the cryptocurrency market will grow with or without his approval: regulatory clarity will likely come at the last stage of market maturation, and will also require some interpretation along the way. O’Leary essentially wants clear solutions for problems regulators have never grappled with before.
If we compare blockchain to the early internet, we see that both faced similar criticisms. However, what O’Leary doesn’t appear to grasp, is that we are dealing with not just a new financial instrument but a technology that promises a paradigm shift in how we understand value.
Kevin O’Leary does not look like he’ll be converted on the cryptocurrency question anytime soon, though. Repeatedly calling it “crypto-crap,” he falls into the same basket that Peter Schiff and others occupy, and continues to misunderstand what the industry is even about.
Do you believe many traditional investors are hostile to cryptocurrencies because they see it as competing with their own assets? Let us know your thoughts below.