Ireland Central Bank Governor Likens Crypto to a Ponzi Scheme

Gabriel Makhlouf, the Governor of the Central Bank of Ireland has expressed a few concerns about digital currencies like Bitcoin (BTC) and the threat they pose to their economy, especially since crypto is not backed by an underlying asset. The apex bank governor mentioned in a statement that such digital currencies have no value and are, therefore, likened to a higher level of Ponzi scheme.

During a conversation with a parliamentary committee, Governor Makhlouf explained how socially valueless digital assets are as well as the fact that customers need to be protected from the limited risks that crypto poses. Considering an investment in the asset class as gambling the Irish bank boss warns investors to be careful as they may lose everything.

“When you gamble you can win but most of the time when you gamble you’re actually losing. If people want to gamble we should let them gamble,” he added “If you put your money into unbacked crypto you need to be prepared to lose all of it.”

“There’s a reasonable number of young adults who have put their money into crypto and there is an uncomfortable level of advertising that is targeted at that cohort. If you could find a way, I would recommend that adverts to that cohort are banned,” the chief of the Irish central bank said.

Crypto Critics Want no Association With BTC

Much like Makhlouf’s conversation, Jamie Dimon, the CEO of JPMorgan Chase & Co shares a similar sentiment about digital assets. While at the JPMorgan 41st Annual Healthcare, he described BTC and other digital assets as “decentralized Ponzi schemes.” The use of cryptocurrencies for crimes like money laundering and sex trafficking further deepens Dimon’s stance on the asset class.

Even in June last year, Yifan He, the Chief Executive Officer (CEO) of  China’s largest blockchain project, Blockchain Service Network (BSN) referred to Bitcoin as a Ponzi scheme. He categorized their risk levels based on their market capitalization and user count.

“I don’t touch them [cryptocurrencies] and won’t touch them in the future even if they become regulated because I don’t consider that they have any value whatsoever,” the Bank of Ireland governor said while further emphasizing his enthusiastic stance on crypto.