Australian Senator Slams Bitcoin as 'Ponzi Scheme'

Australian Senator Sparks Crypto Debate with "Ponzi Scheme" Claims

In a move that has ignited a firestorm within the Australian crypto community, Senator Gerard Rennick of Queensland has dismissed Bitcoin (BTC) as a "Ponzi scheme." The senator's comments, made via Twitter, have drawn immediate backlash from industry groups and enthusiasts alike, who argue that Rennick's stance reflects a "deep misunderstanding" of the technology.

Rennick's critique came in response to a user who sarcastically asked for his "special comments" on Bitcoin, to which the senator replied, "Bitcoin will ultimately go to a $1 million dollars. Why? Because it's a Ponzi scheme whereby BlackRock will pump more and more dollars into a supply-constrained product." He went on to state, "You can't eat Bitcoin," suggesting a lack of real-world utility.

The Queensland senator, who now leads the populist People First Party after leaving the Liberal National Party in 2024, further argued that Bitcoin and its traders contribute "absolutely nothing" in terms of tangible benefits. Rennick stated, "Australia needs real engineers, not financial engineers," emphasizing the need for infrastructure that delivers essential services such as energy, water, and transport.

Industry Advocates Respond with Calls for Education

Bitcoiners and industry advocates were quick to fire back at Rennick's comments. The Australian Bitcoin Industry Body (ABIB) dismissed the senator's remarks as "a deep misunderstanding," warning that "misinformed" takes from public officials could lead to "bad policy." In its response, the ABIB asserted, "This isn't about whether Australians can use Bitcoin—we already do. This is about whether our government is capable of understanding how Bitcoin can enrich the nation… The door is open for ongoing education. The question is: are you willing to walk through it?"

As the discussion gained traction on social media, Rennick brushed off the criticism, stating, "You're disappointed about what a politician thinks about Bitcoin? Seriously? I thought you wanted less political interference. Why does it matter what I think? Invest as you will."

Australia's Regulatory Agenda Moves Forward

Rennick's remarks come amidst a broader push by the Australian government to modernize its approach to digital assets. Just two weeks prior, Prime Minister Anthony Albanese appointed Andrew Charlton as the Assistant Minister for Science, Technology, and the Digital Economy, alongside his new role as Cabinet Secretary.

Charlton is expected to lead Australia's digital asset reform push, including the introduction of a licensing regime that would bring major exchanges under the Australian Financial Services Licence (AFSL) framework. The government also plans to introduce safeguards against debanking and align the framework with global standards like the EU's MiCA and Singapore's Payment Services Act.

As the debate surrounding the role of cryptocurrencies in Australia continues to unfold, it remains to be seen whether the government will heed the calls for ongoing education and a deeper understanding of the technology's potential benefits.