Prior to the housing market collapse, everyone seemed to be celebrating the booming housing market. Lenders were doling out mortgages for homes like they were giving out candy, seemingly convinced that the sky was the limit.
Then, all hell broke loose. Century-old banks went bankrupt, and the subsequent wake left millions without those homes they’d come to cherish.
Now Bitcoin is finally delighting those in the mainstream, with the space-changing announcement from CME. The CME move woke up the crypto world, and many in the mainstream who said, “Hey, it must be time to buy Bitcoin.”
Bitcoin’s price reflected the excitement, smashing upwards to a new record high above $6,400.
But, again, not all are that happy.
Joe Saluzzi, a principal at Themis Trading, thinks there is a bit more to be desired about Bitcoin before we fall head over heels with it. He’s having flashbacks to the 2008 financial crisis.
In a tweet, Saluzzi said:
“Remember the CDO wrapper around all those crappy mortgages during the financial crisis? Placing a wrapper doesn't make it safe.”
CDO stands for collateralized debt obligation and they were notoriously used as the vehicle of choice used by banks to repackage individual mortgages and sell them on the secondary market. The entire scheme led to the housing collapse of 2008.
Saluzzi is anxious about the seemingly euphoric atmosphere around Bitcoin and he told CNBC:
"I have no problem with bitcoin. I like the concept. I have a problem that on Wall Street the innovators are trying to package something up and put a derivative label on it when they really don't know what's underneath. It reminds me of the financial crisis all over again."
Saluzzi told CNBC that there could be spoofing, there could be layering, there could be all sorts of manipulation going on in bitcoin now, and nobody knows. He thinks more government oversight is definitely needed.
"Until they say they are watching and making sure there are no manipulations and fraudulent activities, until they say we have a better regulatory system, I think we are playing with fire."