Citadel chief executive Ken Griffin slams cryptocurrencies

July 19, 2018
Chris Wheal

Ken Griffin, chief executive of hedge fund Citadel, on Wednesday dismissed cryptocurrencies as “a solution waiting for a problem” and stood by an earlier description of the asset class as “digital tulips”.

Ken Griffin, chief executive of hedge fund Citadel

Interviewed at the 8th annual Delivering Alpha Conference, hosted in New York by CNBC and Institutional Investor, the hedge fund chief was asked what he told young portfolio managers who must be clamouring for his approval to invest in crypto assets.

He replied: “I don’t have a single portfolio manager who has told me we should buy crypto.” He added: “There’s no need for cryptocurrencies. They’re a solution in search of a problem.”

No belief

He went on to add that he would not be keen to offer portfolio exposure to cryptocurrencies, even when clients asked for it.

“I have a hard time finding myself wanting to be in a position of being a liquidity provider for a product I don’t believe in,” he said.

Griffin, who founded Citadel in 1990 and now has around $30bn in assets under management, previously likened the cryptocurrency market to the tulip mania of the 17th century, which saw fashionable flower bulbs reach extraordinary valuations before collapsing in 1637.

Too much hype

He said in Wednesday’s interview: “The amount of hype – and the early investors caught up in this hype – the 27-year-old bitcoin investors: I wish they were investing in the companies that define the future of our country and pushing capital in a way that creates jobs and innovation.”

Griffin’s comments echoed those of Larry Fink from earlier in the week. The BlackRock chief executive told Bloomberg Television that he saw little interest in cryptocurrencies.

Fink said: “I’ve not heard from one client who says, ‘I need to be in this’.”

BlackRock, however, is pushing ahead with the establishment of a working group to assess potential investment opportunities in bitcoin futures, according to a report in Financial News on Monday.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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