After a scathing attack on Arthur Hayes at the Asia Blockchain Summit, Roubini has once again hit out at BitMex in a blog post that covers his opinion on the cryptocurrency market, as reported by Bloomberg. Arthur Hayes was unfazed by Roubini’s personal attacks and even gave it back to him with the same ferocity, much to the crypto community’s delight, June 17, 2019.
Crypto’s Biggest Bear
Nouriel Roubini is a well-known economist, but a lot of his recent fame can be accrued to his outspoken views on the cryptocurrency market.
As someone who grew up and lived in the traditional financial system, Nouriel believes it is the best way to get things done efficiently with minimum damage caused to the minnows.
In his latest blog post, Nouriel once again launches a searing attack on cryptocurrencies for their lack of regulation and adherence to know-your-customer (KYC) and anti-money laundering (AML). In reality, most exchanges require customers to undergo KYC and exchanges like Coinbase go as far as checking a user’s address history to look for illegal activity.
While speaking about how cryptocurrency regularly operates outside of government oversight, he takes a particular disdain for BitMex by saying they are involved in systematic illegality and known fraud.
His view is that by giving retail investors a platform to trade 100x leverage with no KYC and just an email ID, Arthur Hayes and BitMex are knowingly deteriorating the wealth of retail investors. He further accused them of trading against their customers and making large chunks of their revenue during times of mass liquidation.
Hayes hit back at these claims in Taipei by saying that BitMex doesn’t counter trade clients and doesn’t make money on liquidations other than fees. To be fair, every Forex broker counter trades their client so Roubini’s argument is null from the get-go.
Speculation Versus Use Cases
A lot of the hate for cryptocurrencies from legacy finance players comes from the fact that they are mostly used as speculative assets.
The ability to pay for goods and services with bitcoin is limited, but the parabolic price gains manage to keep investors locked in while drawing in new ones.
HODL over spending has also been criticized as speculation over actual use case, but most Bitcoiners beg to differ. They consider HODL-ing a hedge to the failures of traditional finance and a means of storing value that cannot be confiscated from a government.