Ex-CEO PayPal says Bitcoin is biggest pump-and-dump ever

In a guest post for Recode, former PayPal CEO Bill Harris issued stark warnings about Bitcoin. Harris is pulling no punches, he flat out tells everyone that he believes Bitcoin is "a colossal pump-and-dump scheme, the likes of which the world has never seen."

In my opinion, it’s a colossal pump-and-dump scheme, the likes of which the world has never seen. In a pump-and-dump game, promoters “pump” up the price of a security creating a speculative frenzy, then “dump” some of their holdings at artificially high prices. And some cryptocurrencies are pure frauds. Ernst & Young estimates that 10 percent of the money raised for initial coin offerings has been stolen.

The losers are ill-informed buyers caught up in the spiral of greed. The result is a massive transfer of wealth from ordinary families to internet promoters. And “massive” is a massive understatement — 1,500 different cryptocurrencies now register over $300 billion of “value.”

Harris argues Bitcoins are not a means of payment, are no store of value, and are only driven by the Greater Fool theory. Furthermore, he points out that transactions are often relatively slow and expensive, and waste a lot of natural resources. In his opinion, cryptocurrency is best-suited for one use: criminal activity. You can read his full post at Recode. He's definitely going to get a lot of feedback on this.