Boris Johnson slams Bitcoin as ‘Ponzi scheme,’ triggers community backlash

Former British Prime Minister Boris Johnson believes that while there is a limited use case for cryptocurrencies, Bitcoin is a ‘giant Ponzi scheme.’ 

Citing his old friend who reportedly lost £20,000 on BTC, Johnson wrote, 

The more elderly people get ripped off – in the name of Bitcoin – the faster that disillusion will set in.

The former PM somewhat agreed with crypto supporters’ strong fixation on ‘decentralization’ to keep BTC away from government devaluation and interference. 

However, he wonders how investors who lose money in crypto, like his friend, can be made whole again if there is no central authority to sue or hold accountable for the damage or hack. 

For him, the anonymous ‘Japanese’ Bitcoin founder Satoshi Nakamoto can’t be traced, verified, or held responsible for the losses. Hence, the whole Bitcoin idea is merely a ‘collective belief’ among crypto supporters, according to Johnson.

He posed, 

What happens when that belief melts away? I’ve long suspected Bitcoin is a giant Ponzi scheme, and now I’m hearing tales of woe that make me fear I’m right.

Johnson’s impact on U.K crypto regulation

As expected, crypto supporters ganged up against him, with some sarcastically calling the U.K a ‘giant Ponzi scheme’ given its high fiscal debt and deficits. Some even extended the sarcasm to the local currency, the Pound. 

Despite his negative view of the sector, however, the Boris Johnson administration (2019-2022) laid the crucial groundwork for the U.K’s current crypto regulatory roadmap.

Notably, former Prime Minister Rishi Sunak, who was Chancellor in Johnson’s administration at the time, pledged to make the U.K a global crypto asset hub. He initiated the push to recognize stablecoins as a valid payment method. 

In fact, the U.K’s Financial Conduct Authority (FCA) began crafting a regulatory perimeter for different crypto assets in 2019. At the time, most crypto activity received minimal regulatory scrutiny. 

However, the comprehensive foundation set during the Johnson administration was later built on and informed the stronger regulation of the sector in 2023. This was after Johnson left office, effectively bringing the U.K’s crypto activity within the regulated financial purview. 

So far, the FCA has approved crypto ETFs and is now working on a regulated framework for stablecoins and a broader market structure. 

Final Summary 

• Former British PM labelled Bitcoin and most crypto assets as a ‘giant Ponzi scheme’ with no real value. 
• Surprisingly, Johnson’s administration laid the foundation for the U.K’s crypto regulations.