On 27th August, Jordan Belfort, the infamous ‘Wolf of Wall Street’ gave his viewpoints on Bitcoin [BTC] and why he thinks Bitcoin will financially hurt a lot of investors.
He stated that he was someone who knows about leveraging a scarcely known commodity and make a fortune off of it. He went on to say that the world governments will never go for the idea of making cryptocurrencies mainstream.
The reason he gave was that governments run with the intention of being the higher authority, something that cryptocurrencies would take away. He was even asked whether parallels could be drawn between Bitcoin scam and himself, a question he shrugged off.
According to the Belfort, Bitcoin in itself is not a scam but rather provides a façade for other scams to take place. Recently, Aarni Saarimaa, a Finnish Bitcoin [BTC] millionaire, was scammed of about 5560 BTCs by a cryptocurrency scam group based in Thailand. This comes up to a total of 797 million baht, or $24 million.
In a recent report by the Bangkok Post, it was mentioned that the investor was told that he will be buying shares in property using the cryptocurrency. Saarimaa wished to buy shares in three companies, invest in a casino and buy new cryptocurrencies. Saarima, after following the said procedures incurred a loss of about $22.3 million.
The Wolf of Wall Street also stated that central banks would do everything to control the flow of money in the financial ecosystem. Once the governments and the SEC fully take charge of the cryptocurrency situation, it will be fully and totally quashed, said Belfort.
He was extremely confident that the concept of cryptocurrencies will be used for massive fraud manipulations, mentioning Tether and why he thinks it will be used to scam investors. Tether [USDT] is a popular stable cryptocurrency which is released for transactions on a 1 to 1 basis with the circulating fiat money. This means that the value of 1 USDT in the market is equivalent to that of 1 USD. The Tether platform is developed on an open, secure, and transparent blockchain technology.
Belfort believes that there are not enough dollars in circulation to maintain the 1 to 1 ratio and thinks that one it will result in a catastrophic financial breakdown. The former penny stock broker then went on to say that the absence of authority is an advantage for fraudsters when they deal in cryptocurrencies but that same currency becomes more vulnerable when converted back to fiat. He also sounded confident while saying that the proponents of the cryptocurrency mania were waiting for more people to join the fold which will increase the final swindle.
Jordan Belfort closed his arguments by saying that the rapid inflation was just another sign that the commodity was unstable and scam worthy, stating again that people should not trust cryptocurrencies.
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