UPDATE: Bitcoin is definitely a bubble, says Wikipedia founder

06/02/18 01:00 PM EDT

By Aaron Hankin

Jimmy Wales, outspoken ICO critic, questions entire 'crypto world'

The co-founder of the largest free-content reference website has slammed bitcoin and the digital currency industry, saying that it is in a bubble that will eventually pop.

Speaking at the Blockshow conference in Berlin -- Europe's version of New York's blockchain-focused Consensus conference -- Wikipedia's Jimmy Wales said the crypto industry is in for a rude awakening. In fact, he said, the sector is in need of some "real journalism," according to Cointelegraph, which is hosting Blockshow.

Read:Opinion: The bitcoin bubble is a bad omen for the U.S. economy (http://www.marketwatch.com/story/the-bitcoin-bubble-is-a-bad-omen-for-the-us-economy-2018-01-12)

It is not the first time Wales has piled on the industry. In an October interview, he warned investors of the risks around the popular, unregulated crowdfunding tools (http://www.marketwatch.com/story/nearly-half-of-all-2017-icos-have-failed-2018-02-26) that raise money for cryptocurrencies.

"There are a lot of these initial coin offerings, which are in my opinion absolute scams and people should be very wary of things that are going on in that area," Wales said in an October 4 interview with CNBC (https://www.cnbc.com/2017/10/05/ico-or-initial-coin-offerings-are-an-absolute-scam-wikipedias-jimmy-wales.html).

Read:The SEC created a fake ICO website to show just how easy it is to scam investors (http://www.marketwatch.com/story/the-sec-created-a-mock-ico-website-to-show-just-how-easy-it-is-for-investors-to-get-fleeced-2018-05-16)

The internet entrepreneur's comments come as the No. 1 digital currency is in the midst of a dire stretch, coming off three consecutive weekly losses for the first time since September 2017, pushing bitcoin to a six-week low.

Despite his negative outlook for the industry, there is a reason Wales may hope he is wrong -- in 2014, Wikipedia announced it had started accepting bitcoin (https://blog.wikimedia.org/2014/07/30/wikimedia-foundation-now-accepts-bitcoin/) as a form of donation, which it still does today (https://wikimediafoundation.org/wiki/Ways_to_Give).

-Aaron Hankin; 415-439-6400; AskNewswires@dowjones.com

 

(END) Dow Jones Newswires

06-02-18 1300ET

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