Shark Tank star Kevin O’Leary, aka Mr. Wonderful, has warned regulators are going to be tough on bitcoin. In addition, he says that “even if bitcoin were to rise another 2,000%, it is totally irrelevant to institutional clients.”
Kevin O’Leary warns against brutal Bitcoin regulations, says Bitcoin is not an institutional product
Canadian investor and television personality Kevin O’Leary spoke about bitcoin in an interview with CNBC’s Squawk Box on Thursday.
O’Leary was asked if he had changed his mind about bitcoin thinking it was “not a real currency” in order to invest in it and possibly buy more. “Let me be clear … I’ve been a cryptonian for years,” replied the Shark Tank star.
He pulled out his phone and said, ‘Here’s my bitcoin wallet. Back then all you could get was ethereum, XRP, bitcoin, litecoin, stellar lumen and bitcoin [cash]. I bought this at the latest fad. I put $ 100 to work here. This morning it’s worth $ 52.77 because not all cryptocurrencies are the same, clearly. He explained:
I’m involved in this because it’s nice, but this is not an institutional product … This whole market, even if bitcoin were to rise another 2,000%, is completely irrelevant to the institutional clients.
O’Leary reiterated that he owns bitcoin, noting, “I drive it on the weekends,” but stressed that “you can’t put this into a fiat … it’s irrelevant to financial markets.”
He clarified, “The real problem is if you get involved here as a fiduciary, it gets regulated, and it gets cut in half or goes to zero, who knows what, you’ve never seen the mother of class action lawsuits coming to it come from those. “
O’Leary was asked to comment on how the Dallas Mavericks, the professional basketball team owned by fellow Shark Tank star Mark Cuban, recently began offering merchandise discounts to customers who pay with bitcoin. “That’s another arena … where you can see bitcoin’s legitimacy from people like Mark Cuban, your buddy, who is trying to make this a more relevant part of people’s lives,” said the CNBC host. Cuban also said recently that bitcoin was more of it a religion than a solution for anything.
“I know Mark quite well, he was also quoted saying he thinks bananas are a bigger common currency and probably he’s right,” said O’Leary, adding:
My whole point is for all of us who oversee and work in the global financial services industry, which is worth billions of dollars, is this a citizen of nothing? It’s not even a single-celled amoeba.
The Shark Tank investor detailed, “The financial markets deal with regulators, and you can only operate within the boundaries of those rules, and so if we glorify something like that. [bitcoin]it really has nothing to do with the financial markets that make the whole world work. And no institutional investor in sovereign funds I have ever spoken to has said that I should index all cryptocurrencies for me. “
Claiming that the institutional investors he spoke to don’t want to own bitcoin because “they fear the regulator,” O’Leary cautioned:
Watch what happens one day and I’m waiting for this one. I’m waiting for the day when one of these regulators comes down hard on bitcoin. Grown men will cry when that happens. You will never experience such a loss of capital in your life. It will be cruel. And I’m just saying you should prepare for it.
Meanwhile, a growing number of institutional investors are investing in bitcoin. Bitgo recently said it sees “unprecedented institutional interest” and Airlift Capital has launched a bitcoin fund in anticipation of an “avalanche of institutional investors.” More banks have also started offering crypto services to institutional clients, such as Standard Chartered Bank. In terms of regulation, the Financial Crimes Enforcement Network (FinCEN) recently proposed new rules that affect cryptocurrency wallets.
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