Charlie Munger Hated Crypto. What Can You Learn From Him Before You Invest?

Charlie Munger, the late vice-chair of Berkshire Hathaway Inc. (BRK.A, BRK.B), never minced words about his views on cryptocurrencies, calling the space “disgusting and contrary to the interests of civilization” in 2021, adding that it was mostly “useful to kidnappers and extortionists.” Later that year, he applauded the Chinese government for banning crypto outright, lamenting that “English-speaking civilization has made the wrong decision” by letting the boom run wild, and, in a 2023 Wall Street Journal op-ed he reduced the whole asset class to “a gambling contract with a nearly 100% edge for the house.”

Despite Munger’s warnings, however, the blockchain and crypto space have only continued to mature and thrive.

Munger’s colorful barbs were consistent with the value-investing playbook he honed over seven decades. Thus, his critiques contain durable lessons about risk, valuation, and temperament.

For Munger, Crypto Was ‘Disgusting’

At Berkshire’s 2021 annual meeting, a shareholder inquired about the rapid rise of bitcoin. While Buffett dodged the question, Munger quickly retorted, “Of course I hate the bitcoin success, continuing with a sweeping indictment: the token was created ‘out of thin air’ and promoted speculative excess, financial crime, and social harm. In other public comments, he has asked, “What is it that this thing is doing for civilization?” If the best answer is that “number goes up”—an often-used refrain at the time—consider walking away.

To Munger, crypto trading resembled a global slot machine: exciting, addictive, and stacked against the player. He proposed that bitcoin was akin to a “gambling contract” with odds worse than Vegas because the house could be some opaque offshore exchange.

Munger was not a speculator. Instead, he loved businesses with predictable, durable cash flows—think Coca-Cola’s (KO) steady dividends (a position Berkshire first entered in the 1980s)—because valuation could be anchored to profits. Real assets should generate cash flows, create jobs, or provide useful services. Crypto, in his view, produced nothing but price volatility, so price appreciation had to come from recruiting the next buyer, not from underlying value creation.

A Value-Approach to Crypto

Despite these views, the market has (so far) proven Munger wrong.

For advocates, crypto tokens can provide real-world utility. Beyond price gains, Bitcoin powers near-instant, low-cost, peer-to-peer payments worldwide, while Ethereum anchors a decentralized-finance stack securing more than $100 billion in value—real payment, lending, and settlement rails that millions use every day. Dozens of other blockchains similarly function with viable real-world applications.

Most importantly to speculators and investors, Bitcoin now trades comfortably above $100,000, U.S. spot-Bitcoin exchange-traded funds (ETFs) hold more than $132 billion in assets, and Ethereum’s network generated over $1 billion in fee revenue in the first quarter of 2025 alone—hardly the bust Munger suggested would happen.

Ways To Apply Values Investing to Crypto

1. Start with a use case, not a ticker symbol. Identify a blockchain service or value proposition that genuinely solves a problem you understand—such as payments, stablecoin remittance, or on-chain identity—and study its competitive moat.
2. Scrutinize token design. Inquire about how the token generates value and whether supply inflation can dilute the value for holders. Are the project founders and developers skilled and trustworthy? Does the source code make sense?
3. Treat on-chain fees like cash flow metrics. Check whether a network’s fee revenue, developer activity, and user count are rising faster than token issuance. If they aren’t, move on.
4. Use regulated wrappers. An ETF or managed trust, when available, offers audited statements and lower counterparty risk—closer to owning a commodity fund than juggling private keys.
5. Admit knowledge gaps. If the white paper reads like astrophysics, skip it and allocate to assets you can actually analyze.

The Bottom Line

Munger’s contempt for crypto wasn’t just a cranky reflex; it flowed from first principles: buy productive assets, shun speculation, and stay rational when crowds go mad.

Crypto tokens rarely offer traditional equity-like claims on project revenue, and models such as “burns” or “staking yields” can evaporate if demand falls or the project leaders abscond. That said, legitimate projects’ successes and future growth prospects should not be ignored.