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“It’s stupid because it’s very likely to go to zero. It’s evil because it undermines the Federal Reserve system.”
When Charlie Munger spoke about Bitcoin, he didn’t mince words. Known for his blunt honesty and disdain for speculation, Munger called Bitcoin not just foolish — but morally corrosive.
In just a few sentences, he captured his lifelong philosophy about money, markets, and discipline. To Munger, Bitcoin represents the exact opposite of everything he and Warren Buffett have stood for over 70 years: patience, intrinsic value, and productive capital allocation.
Why Munger Hated Bitcoin
“It’s stupid because it’s very likely to go to zero.”
For Munger, every investment starts with one question: What is this thing worth? If the answer depends on someone else paying more for it tomorrow, he calls it speculation, not investing.
Bitcoin, in his view, produces no earnings, pays no dividends, and has no tangible utility. Its value depends entirely on perception, not productivity.
This is why he compared cryptocurrency trading to “trading turds” — a famously harsh but revealing analogy that underscores his belief that real wealth comes from ownership of productive assets, not hype cycles.
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“It’s Evil Because It Undermines the Federal Reserve”
Munger wasn’t just concerned about Bitcoin’s volatility — he viewed it as a threat to economic stability.
“It’s evil because it undermines the Federal Reserve system and the national currency system, which we desperately need to maintain its integrity and government control.”
His reasoning was straightforward: civilizations depend on stable money. The Federal Reserve, despite its flaws, underpins a functioning economy — regulating credit, stabilizing inflation, and managing liquidity.
Bitcoin, by contrast, exists outside this framework. Munger believed that promoting an unregulated parallel currency system erodes trust in institutions and invites chaos — especially among uninformed investors seeking quick gains.
While he was criticized for being “old-fashioned,” Munger’s caution echoed similar warnings from regulators worldwide, including the Bank of Canada, which has repeatedly flagged the risks of crypto volatility and scams.
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“It Makes Us Look Foolish Compared to the Communist Leader in China”
“And third, it makes us look foolish compared to the communist leader in China.”
Munger admired the Chinese government’s pragmatic ban on cryptocurrency speculation. In his view, Beijing’s decision to outlaw Bitcoin mining and trading wasn’t authoritarian — it was rational.
He saw it as a rare instance where centralized control prevented collective madness. By contrast, Western markets allowed speculative mania to flourish under the banner of “innovation.”
This quote reveals something deeper about Munger’s worldview: he valued order, rationality, and meritocracy — even if they came from systems he didn’t fully endorse politically.
It also highlights one of his greatest fears: that Western capitalism, obsessed with short-term greed, might lose its moral compass.
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The Core of Munger’s Philosophy: Rational Capitalism
Munger’s disdain for Bitcoin wasn’t about technology — it was about principle.
He and Buffett built Berkshire Hathaway on the idea that capital should flow to productive enterprises — businesses that make goods, create jobs, and compound real earnings over time.
Bitcoin, in his view, subverted that idea by rewarding speculation over creation.
That’s why even at 99 years old, Munger remained steadfast:
“I wish it had never been invented.”
His legacy isn’t anti-innovation — it’s pro-reason. He believed that civilization progresses when people allocate capital wisely, not when they gamble it away.
Final Thoughts
Charlie Munger’s take on Bitcoin may sound harsh, but beneath the criticism lies timeless investing wisdom:
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Avoid what you don’t understand.
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Don’t confuse speculation with ownership.
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Trust in rational systems that preserve stability.
Whether or not Bitcoin survives, Munger’s principles will — because they’re rooted in something far more enduring than hype: discipline, patience, and reason.
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Qayyum Rajan, CFA
Qayyum is the CEO of Wealth Awesome, a leading Canadian personal finance publication. As a CFA charterholder with extensive experience in fintech, data science, and quantitative finance, he brings a unique analytical perspective to investing and wealth management.
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This content has been reviewed by CFA® charterholders and Certified Financial Planners (CFP®) with over a decade of experience in Canadian financial markets. All information is fact-checked against official Canadian sources and regulations.
Why these credentials matter: CFA® charterholders complete 900+ hours of rigorous study in investment analysis and ethics. CFP® professionals are held to the highest standards of financial planning competency and fiduciary duty in Canada.
⚠️ Professional Disclaimer
This content is for educational purposes only and should not be considered personalized financial advice. While our team brings professional expertise, individual circumstances vary. For personalized guidance, consult with a qualified financial advisor, tax professional, or mortgage specialist.
