Cryptocurrency Deception Exposed: Reeves Investment Ensnaring Masses in Global Scam, Warns Alex Brummer
Investing wisdom from the legendary Warren Buffett is unmatched, especially after his 60-year reign at Berkshire Hathaway. Now, at the tender age of 94, he's choosing to step back from the volatile financial scene.
His lair, buried deep in Omaha, Nebraska, may be miles away from the glitzy streets of New York, but it's been a lifeline during times of financial turmoil. When Salomon Brothers stumbled in the '90s amid a trading scandal, Buffett stepped in as chairman and cleaned up the mess. Fast forward to 2008, when Goldman Sachs was teetering on the edge of collapse, Buffett swooped in with $5 billion in temporary capital, giving them the push they needed to stay afloat.
As the Biden administration moved away from fossil fuels, Buffett made his move by snatching up Occidental Petroleum. When it comes to cryptocurrency though, the Oracle of Omaha isn't impressed. He notoriously referred to it as 'probably rat poison squared' and has assured Berkshire shareholders that they won't be diving into crypto anytime soon.
It would've been great if Rachel Reeves, the UK's Chancellor, had been listening. In a baffling move, she's swung full force behind the fintech and crypto sector, promising to support its builders while ensuring stability. Supporting UK fintech is indeed a smart move, given our country's leadership in this field. The list of homegrown fintech successes just keeps growing.
However, backing crypto is a different story. It's favored by financial miscreants, crooks, and terrorist groups like Hamas for its anonymity. Money can be moved quietly from crypto wallets to far-flung locations, making it a dream for those looking to avoid detection.
The dark side of crypto was exposed in the Sam Bankman-Fried and FTX saga of 2023. A headline from that year chillingly reported that French police were investigating the kidnappings of people linked to cryptocurrency, with one unlucky soul even having his fingers chopped off by attackers demanding a ransom in crypto. This is the booming investment sector that Reeves seems eager to embrace.
She's inspired by a desire to keep pace with the crypto zealots dominating US financial regulation and the Trump dynasty's crypto billions. The UK's approach is to bring crypto assets, including stablecoins (supposedly backed by real money), under the regulatory umbrella. Until now, the FCA has advised investors to steer clear of crypto scammers.
The paradox is that by creating a regulatory framework, it might confer legitimacy onto an opaque asset class with no transparency. Central banks, including the Bank of England, generally aren't fans of crypto. It bears little resemblance to real currency as a store of value, more like the paper money on a Monopoly board.
Regulation is meant to shield consumers, but crypto governance exposes us all to becoming victims of a global scam.
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- Warren Buffett, despite his retreat from the volatile financial scene, maintains his strong stance against cryptocurrency, referring to it as 'probably rat poison squared' and assuring Berkshire Hathaway shareholders that investments in crypto are unlikely.
- Despite the UK's Chancellor Rachel Reeves's enthusiasm for embracing the crypto sector, it's important to note that cryptocurrency is a controversial investment due to its association with financial miscreants, crooks, and terrorist groups for its anonymity, as the Sam Bankman-Fried and FTX saga of 2023 demonstrated.
- Aiming to bring cryptocurrencies, including stablecoins, under regulatory oversight, the UK's approach faces the paradox of potentially conferring legitimacy onto an opaque and questionable asset class that bears little resemblance to real currency.
- In contrast to the uncertainty surrounding cryptocurrency, top DIY investing platforms like AJ Bell, Hargreaves Lansdown, interactive investor, InvestEngine, and Trading 212 provide opportunities to invest in stocks and other traditional investment assets with more transparency and regulatory oversight.
- It's crucial for investors, regardless of their focus area, to carefully consider the risks and potential pitfalls of different investment opportunities, as volatile financial scenes and unregulated asset classes can lead to significant losses.
