In a recent interview on CNBC’s “Squawk Box,” actor Ben McKenzie expressed his skepticism towards cryptocurrencies, likening them to a Ponzi scheme or multi-level marketing (MLM) scheme. Despite the significant rally in Bitcoin, which is currently up 80% year-to-date, McKenzie remains unconvinced of the legitimacy of cryptocurrencies as financial assets.
According to McKenzie, cryptocurrencies are more of a “story” that can be easily pushed out of existence if people stop believing in them. He believes that in MLMs, 99% of people lose while only 1% benefit, and in the crypto market, the main beneficiaries would be exchange owners, venture capital firms, and those who issue the coins.
McKenzie’s skepticism is not unfounded, as regulators, such as the U.S. Securities & Exchange Commission (SEC), have recently taken actions against crypto exchanges like Binance and Coinbase for allegedly violating securities laws. However, McKenzie suggests that greater regulation and more sophisticated licensing could help transform the crypto market into a more legitimate financial market.
He points out that the current crypto market operates in an unregulated and unlicensed manner, often through shell corporations in the Caribbean. The lack of clear classification between securities and commodities has allowed cryptocurrencies to thrive in this gray area. McKenzie believes that implementing stricter regulations and licensing requirements could bring more credibility and stability to the market.
While McKenzie expresses his skepticism towards cryptocurrencies in general, he is particularly bearish on cryptocurrencies other than Bitcoin. He argues that Bitcoin has at least a limited supply, which gives it some level of intrinsic value. McKenzie’s views contrast with market experts like Professor Carol Alexander of Sussex University, who recently predicted that Bitcoin could reach $50,000 by the end of 2023.
Overall, Ben McKenzie’s comments reflect the ongoing debate surrounding the legitimacy and future of cryptocurrencies. While some, like McKenzie, remain skeptical and see parallels between cryptocurrencies and fraudulent schemes, others argue that proper regulations and institutional interest could bring stability and credibility to the market. As the crypto industry continues to evolve, it remains to be seen how it will navigate these challenges and gain wider acceptance.