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Bitcoin is a “Pyramid Scheme” With No Utility, Says Lending Tree Economist

Despite being crowned the best performing asset of the last decade, Bitcoin critics still do not see the cryptocurrency as a viable investment vehicle. Instead, they are attacking the cryptocurrency’s pricing model, comparing it to a “pyramid scheme.”

One such critic is Lending Tree Chief Economist, Tendayi Kapfidze. Lending Tree is an American online lending marketplace connecting borrowers with multiple lenders at competitive rates.

Although operating within the fintech space, Kapfidze still sees no real-world utility for Bitcoin telling Yahoo Finance:

“[Bitcoin] It’s a pyramid scheme. You only make money based on people who enter after you.” 

He further mentions that Bitcoin proponents have “been trying to create a utility for it for ten years now” because the cryptocurrency is a “solution in search of a problem and it still hasn’t found a problem to solve.”

Kapfidze was apparently referring to the fact that fiat currencies are still widely used, making the demand for a digital currency still incredibly low.

Meanwhile, Bruderman Asset Management Chief Market Strategist Oliver Pursche who spoke to Yahoo Finance on the same topic had a slightly different opinion.

While Pursche admitted that cryptocurrencies are speculative assets and are not guaranteed to make holders a millionaire or billionaire overnight, he said owning them is the best way to understand what the technology stands for.

“For me, it’s also a way to get educated on it… to me, if you want to learn about it, you’ve got to own it because that’s the only way you’re going to truly educate yourself and pay attention,” Pursche said.

In a similar development last year, Coinfomania noted that CNBC’s Kevin O’Leary may own a substantial amount of Bitcoin despite often appearing on media as someone who has little to no knowledge about the emerging asset.

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