Bitcoin Is “The Last Thing I’d Want to Own if Grid Goes Down,” Says Famed Short Seller Jim Chanosbr>
Jim Chanos, president and founder of Kynikos Associates, said that bitcoin is the “last thing” he’d want to own in a full-blown crisis.
Chanos began his career in the 1980s as a short seller. After working as an analyst in several firms, he founded Kynikos in 1985 with $16 million, as a firm specializing in short selling. He gained notability as a short seller when he predicted the fall of US energy giant Enron, before it filed for bankruptcy in 2001.
In an interview with the Institute for New Economic Thinking, Chanos said that in the event of a global crisis, it would be “better” to own food, or a government-backed fiat currency.
“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. “The last thing I’d want to own is bitcoin if the grid goes down. 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 said that the past year’s euphoria over bitcoin and other cryptocurrencies fits into the “fraud cycle,” in which people grow less skeptical during long periods of market gains, plowing into investments that would normally seem too good to be true.
“This is simply a security speculation game masquerading as a technological breakthrough in monetary policy,” he said. “I suspect going forward we’re going to see more and more evidence of questionable companies as this bull market keeps advancing and aging.”