When drivers ask about bitcoin, I worry about big losses


Following bitcoin’s weekend selloff, Sebastian Siemiatkowski, co-founder and CEO of Swedish fintech big Klarna, is doubling down on his issues round an ongoing gold rush into digital currencies.

“There’s a variety of promise in cryptocurrencies,” Siemiatkowski stated Tuesday on CNBC’s “Worldwide Trade.” “However on the similar time, I am deeply fearful that the large danger is like when my cab driver is asking me if he ought to put money into bitcoin. That is after I get nervous that lots of people will come late into the celebration and lose some huge cash.”

Siemiatkowski has beforehand stated he is “deeply fearful” about posts selling bitcoin on Twitter and thinks regulators ought to act to guard individuals from potential losses.

Bitcoin and different digital currencies have surged in worth in 2021 on the again of elevated curiosity from institutional buyers, whereas main firms like Tesla and PayPal have additionally made important strikes within the area. Tesla purchased $1.5 billion price of bitcoin earlier this yr and now accepts it as cost for its automobiles. Beginning Tuesday, Paypal’s Venmo will present customers a brand new characteristic that lets them put money into 4 totally different cryptocurrencies — bitcoin, ether, litecoin and bitcoin money — and share their purchases with buddies by way of Venmo’s social feed.

The cab driver has grow to be a speaking level within the protection of a bitcoin bubble — just like the generally informed story of Joseph Kennedy Sr. changing into fearful in regards to the market earlier than the 1929 crash after receiving inventory ideas from a employee shining his sneakers. Some crypto bulls have pushed again towards the concept, although.

In a collection of tweets earlier this yr, CoinShares chief technique officer Meltem Demirors contended that “your cabbie shopping for bitcoin is not an indication of the highest for the market.” It is a lot simpler to find out about investing now because of the web, she wrote, as a result of “top quality analysis is freely and available.”

Whereas bitcoin bulls see it as a retailer of worth akin to gold, like Siemiatkowski, not everyone seems to be satisfied by the digital forex’s growth — it beforehand sank as little as $3,122 in 2018 after climbing to virtually $20,000 a yr earlier. Skeptical economists view bitcoin as a bubble ready to burst.

“As a lot as I am excited in regards to the expertise, I am all the time fearful about speaking about it as a result of there’s a large danger and such a unstable play at this cut-off date,” Siemiatkowski stated. “You already know, after I say what I simply stated, I promise you should have 500 individuals on Twitter chasing me for even daring to precise skepticism.”

In February, CNBC reported that Siemiatkowski’s Klarna is near finalizing a $1 billion funding spherical that may give the corporate, ranked No. 5 on final yr’s CNBC Disruptor 50 record, a valuation of $31 billion.

Based in 2005, Klarna is amongst many potential tech IPO candidates in Europe. “Perhaps it may occur this yr, perhaps it might be subsequent yr, nevertheless it’s clearly going to occur pretty quickly,” Siemiatkowski informed CNBC earlier this yr. “It is undoubtedly within the works however we’ve not formally began the method.”

Klarna’s CEO added that the agency finds direct listings — another path to a standard IPO the place corporations record with out issuing any new shares — “fascinating.”

—CNBC’s Kevin Stankiewicz contributed to this text.

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