The CFO of Visa joins the growing list of public figures and finance executives who qualify cryptocurrency bubbles. During an interview for Financial Times, he made powerful remarks about the Bitcoin craze on March 16th, claiming that cryptocurrency was used by “all crooks and dishonest politicians under the ignorance of speculators.”
“My personal view is that cryptocurrencies are more speculative investment commodities than payment options, operating in a very unsettled regulatory environment. The markets are testing cryptocurrencies today with the volatile fluctuations we’ve seen recently. It is early days, and we will watch it very closely,” he declared. “The people asking me are the ones who scare the hell out of me. You know, guys like the limo driver to the airport… They have no idea what they are doing.”
The chief financial officer of the largest payment network, regarding market value, said he lived not far from “true believers” in Silicon Valley who think “people like him are dinosaurs.”
Vasant Prabhu said that Bitcoin and other virtual assets are a bubble because of the sheer number of investors who told him about investing in cryptocurrencies, including a limousine driver, in a bank and a young family member.
“This is the ultimate thing that you hear about when you have a bubble when the guy shining your shoes tells you what stock to buy.”
Prabhu announced during the interview for Times that he believes that criminals favor cryptocurrencies because of their anonymous aspect and their lack of supervision.
“It is very hard to get dirty money through a banking system. Cryptocurrency is phenomenal for all that stuff… Every crook and every dirty politician in the world, I bet, is in cryptocurrency.”
Prabhu’s comments join those of Bank of England Governor Mark Carney, UBS, Goldman Sachs chief investment officer Sharmin Mossavar-Rahmani and hedge fund Elliott Management, all having to reveal their skepticism about cryptocurrencies and their prices in recent months.
Lately, Wall Street analyses have altered their cryptocurrency views and have simply become reluctant to comment on the controversial topic. Jamie Dimon, head of JPMorgan Chase, regrets describing Bitcoin as a “fraud,” not because his opinion has changed but because many people have wanted to debate it.
Visa, with a market capitalization of $279 billion, has not been outdone on troubling questions, asking if the new payment systems will disrupt its business model. The company’s shares are rising, which responds in a certain way.
Despite Prabhu’s reluctance on cryptocurrencies, Visa is experimenting with blockchain technology. Its pilot project will facilitate cross-border business payments, using a platform based on the blockchain.
However, Visa does not process or directly regulate transactions in cryptocurrencies. “Visa does not block consumers from using its network to buy cryptocurrency, although several banks that issue its cards have implemented such a ban. The company also went to great lengths to comply with know-your-customer and anti-money laundering rules,” Prabhu said. “We shut people down immediately where we have even the whiff of wrongdoing.”