New York — This was anticipated to be the year when cryptocurrency, a 16-year-old investment vehicle that claimed to revolutionize finance, truly established itself. The multi-trillion-dollar sector received nearly everything it desired over the past year: an influx of fresh capital from traditional investors, bipartisan legislative support in Congress, a favorable regulatory environment, and notably, the backing of the U.S. president. However, despite these advancements, the cryptocurrency market has encountered significant challenges, with Bitcoin experiencing a 30% decline from its early October peak, a drop far more severe than that of the broader stock market.
One of the most vocal critics of the industry is actor and author Ben McKenzie, who recently premiered his documentary, “Everyone Is Lying to You for Money,” at the DOC NYC film festival. I had the opportunity to engage with McKenzie, known for his roles in “The OC” and “Gotham,” in a virtual discussion regarding the recent market downturn and the timely release of his film. This conversation has been condensed for clarity and brevity.
Understanding Crypto Volatility Amid Institutional Support
CNN: Given the robust institutional backing for cryptocurrency, what factors do you believe are contributing to its ongoing volatility?
Ben McKenzie: Several factors could be at play here. Firstly, the economy appears to be slowing down. If we view cryptocurrency as an investment based on digital code, it can reflect the more speculative segments of the market. It’s akin to a canary in a coal mine—when cryptocurrency experiences a significant drop, it could indicate broader economic troubles. Additionally, the surge in cryptocurrency values was largely driven by companies like MicroStrategy adopting Bitcoin as part of their corporate strategy. However, MicroStrategy’s fortunes have recently declined, with its stock price plummeting approximately 40% this month, raising concerns that it may need to liquidate its Bitcoin holdings. Another issue within the crypto space is the excessive leveraging that investors engage in to amplify their bets. When prices fall and de-leveraging occurs, the market can collapse just as swiftly, if not more so, than it rose, which is particularly alarming given the ever-increasing figures involved.
Crypto as a Zero-Sum Game
CNN: Your strong stance that cryptocurrency is fundamentally a scam has been widely noted. How do you respond to advocates who argue that anyone who invested in the last decade would have seen substantial returns?
Ben McKenzie: They are essentially saying that if you invested early in what I and others have termed a Ponzi scheme, you would have profited. To which I would say, yes, that’s correct. However, that isn’t the main argument proponents believe they are making. Ultimately, it circles back to my constant assertion that cryptocurrency lacks an underlying asset, making it a zero-sum game. Any profit you make comes at someone else’s expense. There is an ethical dimension to this that extends beyond mere investment gains. The extent of criminal activity facilitated by cryptocurrency is staggering, involving billions in money laundering, influence trafficking, and financing for terrorism. So, is it justifiable for a few individuals to benefit while the majority suffer? For me, the answer is a resounding no.
Concerns About the Future of Crypto
CNN: As you look toward the future, what aspects of the current trajectory of cryptocurrency cause you concern?
Ben McKenzie: I had an unsettling feeling when Trump endorsed cryptocurrency last summer, which worsened post-election. I’ve been genuinely taken aback by the level of deceit occurring in this space. However, I do feel somewhat more optimistic lately… His approval ratings are slipping, the market is declining, and the economy is showing signs of slowing. Historical patterns of other nations witnessing the collapse of unpopular leaders suggest he may be in for some turbulent times ahead.
Shifting Focus to AI and Speculative Markets
CNN: You’ve been a consistent critic of cryptocurrency for several years. Do you intend to maintain this focus, or are you considering branching into other speculative markets, particularly artificial intelligence? Is there a sequel to “Easy Money” in the pipeline?
Ben McKenzie: I am indeed tempted to explore the AI sector, which has become significantly more expansive. There’s a concept known as the grift shift—a classic con artist tactic that involves promoting something that may not function well at present but will supposedly be revolutionary in the future. This strategy has worked for cryptocurrency, and it certainly applies to AI as well. I should clarify that I do not endorse the direction AI is taking; however, in its defense, AI does have tangible applications in the real world that don’t revolve around gambling and illicit activities.
