(Kitco News) - Ken Griffin, the founder of Miami-based trading firm Citadel Securities, pulled no punches in a recent conversion with CNBC when he suggested that people moving away from the “speculative bubble” that is crypto, nonfungible tokens (NFTs), and meme stocks is a positive sign for the U.S. economy.
The response emerged from a discussion surrounding the government handouts in 2020 as a response to the COVID-19 lockdown, which resulted in investors pumping their newly found cash into these “speculative assets.”
All three of the aforementioned asset classes experienced blow-out performances at some point in 2021 as traders frantically attempted to acquire them amid rapidly appreciating prices, only to see their values plummet in 2022 amid a wider economic downturn.
Now that the bubbles have burst, Griffin sees it as a “healthy” sign for the U.S. economy, which can now start to regain some semblance of order.
“Now that we’re past that moment in time and people are starting to spend those savings down to travel, go out to eat, enjoy other items in life that they want to have, we’re seeing that speculative bubble really recede,” the billionaire said at CNBC’s Delivering Alpha Conference Wednesday.
“And this is healthy for the economy. Money misallocated in speculative assets doesn't create jobs in the long run, doesn't help to create the long-term prosperity that makes America the country that it is,” Griffin said.
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The Citadel Securities founder also noted that younger people, including the ones that work at the firm, are more interested in crypto because they value privacy and have a more “libertarian view of the world.”
Griffin also alluded to platforms like Celsius and Terra/Luna by saying that “billions of dollars going into companies that are effectively going to go broke, tens of billions” is not good for markets.
Negative comments about the cryptocurrency sector are nothing new for Griffin, who once called the space a “jihadist call” against the U.S. dollar and said he is keeping his firm out of the digital asset space because he didn’t want to “help fund the North Koreans.”
