Former Israeli Prime Minister Ehud Barak Attacks Bitcoin As A “Ponzi Scheme”, Praises Blockchain
The creation of Bitcoin was a revolutionary shock to the financial system. The limited number of tokens makes them elusive, and their reign as the top cryptocurrency by market cap has even earned them a position as the household name for the industry. However, Ehud Barak feels much differently about the token.
Barak, the former prime minster of Israel, was recently at the Globes Most Promising Startups event with editor-in-chief Na'ama Sikuler of Globes. He spoke on his recent investment with InterCure Ltd, a medical cannabis company. Connecting to the crypto world, Sikuler asked Barak if he felt like the medical cannabis world and interest is a bubble, like Bitcoin.
Quickly, he answered,
“Blockchain itself is a mathematical technological concept and an interesting and important methodology. The cryptocurrencies, bitcoin and all the others, that's a Ponzi scheme. I don't believe that it's possible to make a currency in this way in the current generation, and I wouldn't invest in anything that's related to cryptocurrencies. Whoever has got the patience and understands blockchain deeply, can find a lot of uses for it, from keeping sensitive medical information through to contracts.”
Barak admitted that there is a lot of “hype and buzz” regarding cannabis, since multiple companies chose to trade on Nasdaq.
“Medical cannabis is much more serious, and Israel is a very important center of knowhow, and the small company that I head InterCure has distributed 500,000 dosages to thousands of patients for whom it is more valuable than gold.”
Gary Shipping, an analyst on Wall Street, feels similarly, also saying that Bitcoin is a Ponzi scheme. However, he decided to make a move with his own investment firm, maintaining their refusal to work with Bitcoin.
“A currency has to have a store of value. With the volatility in bitcoin prices, I don’t think it has a store of value.”
According to the nemesis of Barak in the political world, current prime minster Benjamin Netanyahu, Bitcoin could be powerful enough to eliminate the need or use of banks.
Last year, in December, he commented in Hebrew,
“Is the fate of banks that they will eventually disappear? Yes. The answer is Yes. Does it need to happen tomorrow, and do we need to do it through bitcoin? That’s a question mark.” Considering the impressive streak that Bitcoin went through in December, he commented then, “The truth behind what I just said is what’s propelling bitcoin upwards.”