From rat poison to Beanie Babies, these celebs got bitcoin all wrong
Many famous people got Bitcoin totally wrong. Thousands dismissed it as a scam or pyramid scheme, while others predicted hackers or the government would shut it down. Skeptics like Elon Musk even criticized its environmental impact while promoting blatant scams (remember CumRocket?).
So below we’ve compiled a short list of some of the famous people who have been completely wrong about bitcoin since the project started 13 years ago.
Behold, Bitcoin’s celebrity wall of shame.
Best known as the CEO of SpaceX, Tesla, and The Boring Company, Elon Musk frequently misunderstands bitcoin.
Musk frequently criticized its energy usage, once saying, “Bitcoin hashing (a.k.a. mining) energy usage is starting to exceed that of medium-sized countries. Almost impossible for small hashers to succeed without those massive economies of scale.”
Ironically, Musk’s company Tesla briefly accepted bitcoin payments for its electric vehicles. However, Elon Musk removed that option, claiming he somehow had not understood bitcoin mining’s effect on the environment while appropriating the opportunity to promote his pet project, Dogecoin, instead.
Telsa briefly owned over a billion dollars worth of bitcoin, yet the company’s second quarter 2022 earnings report revealed that Musk has sold three-quarters of its bitcoin.
Musk ignored the amount of renewable energy that Bitcoin mining uses. Coinshares released a report showing that 74% of Bitcoin’s energy came from renewable sources in 2019. The Bitcoin Mining Council said that more than half of the energy used for Bitcoin mining came from renewable sources in the second half of 2021. Coindesk writer Nic Carter proposed that mining could incentivize development of renewable energy sources which have struggled with its power grid during the harsh winter months of early 2021.
Buffett’s protégé and Berkshire Hathaway Vice Chairman Charlie Munger also criticized the leading crypto in April 2022, saying that it’s “stupid, evil, and makes me look bad.”
However, even billionaires like Buffet sometimes drop the ball. Buffett’s mantra, “Never invest in a business you can’t understand,” meant he was decades late to the internet industry. This is a goof he’s readily owned up to, specifically his decision not to invest in Google.
Perhaps he simply doesn’t understand bitcoin any more than he understood the early Internet. After all, it’s doubled in value since his rat poison line.
Senator Elizabeth Warren
Senator Warren criticized bitcoin’s energy usage, claiming, “A single bitcoin transaction uses more energy than a typical US household in a month. I think the estimate is 53 days.”
Firing back, Blocktower Capital CIO Ari Paul retorted, “Social media uses more electricity than bitcoin. You could do more for climate change by not tweeting.”
Galaxy Digital Mining released a detailed May 2021 report:
- “Always-on” household appliances consume 1,375 TWh annually
- The banking system consumes 238.92 TWh annually
- Bitcoin consumes 113.89 TWh annually
Galaxy Digital Mining’s report made the point that context matters when discussing bitcoin’s energy usage. Many other industries and applications use more electricity than bitcoin, including Christmas lights.
In 2019, he called for a crypto ban, branding digital currency a threat to US foreign policy and the rule of law.
But despite his desire to protect investors, bitcoin went on to double in price since Sherman called for banning it.
In February 2022, he said that digital assets hurt people of color, something that made little sense to digital asset insiders, considering that one of bitcoin’s selling points is that anyone can download a wallet for free and validate the entire blockchain on a home desktop PC.
In turn, Sherman was criticized for taking campaign donations from big banks and mainstream financial institutions. Donors included the American Banking Association, Capital One, and Charles Schwab.
US Secretary of the Treasury Janet Yellen falsely claimed that bitcoin is mostly used for illicit financing.
“I think many are used, at least in a transactions sense, mainly for illicit financing and I think we really need to examine ways in which we can curtail their use and make sure that anti-money laundering [sic] doesn’t occur through those channels,” she told a congressional committee while going through confirmation proceedings as Treasury Secretary.
While bitcoin has been used for a small number of ransomware attacks and fraud, Kraken’s Dan Held clarified that Yellen was wrong about bitcoin being synonymous with illegal activity, revealing that crime accounted for less than 0.3% of crypto-related activity in 2020.
Schiff has made bearish predictions about bitcoin since it was trading below $1,000. A quintessential permabear, he recently warned, “Don’t buy the dip,” as bitcoin tried to break out of its downtrend. He even claimed some holders might have to sell to cover basic expenses as inflation soars.
Bitcoin investors will likely always ignore Peter Schiff’s warnings, considering that he’s made gloomy predictions about bitcoin since it traded over 95% cheaper than today’s price.
JP Morgan Chase CEO Jamie Dimon repeatedly bashed bitcoin. He called bitcoin “worthless” in October 2021 just as the currency was hitting new all-time highs. He claimed that JP Morgan wouldn’t stop account holders from buying it but would not hold bitcoin itself.
He previously called bitcoin “a fraud,” “stupid,” and “far too dangerous.” Dangerous or not, bitcoin has rallied over 300% since his name-calling.
American Economic Liberties Project member Matt Stoller recently said of bitcoin, “My guess is that crypto will never become wholly worthless, but it will eventually become irrelevant, like the Beanie Baby frenzy of the 1990s.”
While there have been Beanie Baby-like fads in the digital asset industry, bitcoin has gained enough traction over the past 13 and a half years that it probably is not one of them. Anyway, a fully fungible token is not the same thing as a collectible.
Admittedly, he wasn’t specifically wrong about bitcoin, but Matt Damon became one of several actors and entertainers who jumped on the digital asset bandwagon when he appeared in a Crypto.com commercial that aired during the 2022 Super Bowl.
Since then, Crypto.com customers have frequently criticized its customer service and the embarrassing commercial has since disappeared from TV. It is, however, still on Crypto.com’s YouTube channel.
In 2016, TransferWise (now Wise) CEO Taavet Hinrikus said, “No one is using bitcoin.”
Bitcoin went on to rally tens of thousands of percentage points since he proclaimed the currency dead.
Former Federal Reserve Chairman Alan Greenspan called bitcoin’s price “unsustainable” in 2013.
“It has to have intrinsic value. You have to really stretch your imagination to infer what the intrinsic value of bitcoin is. I haven’t been able to do it. Maybe somebody else can,” he told Bloomberg in an interview.
To say Greenspan was wrong about bitcoin is an understatement as the currency has rallied over 20X above his “unsustainable” price.