Ben McKenzie Schenkkan: From Actor to Author and Crypto Critic
Ben McKenzie Schenkkan, the well-known actor and author, recently spoke at a Senate Banking, Housing, and Urban Affairs Committee hearing on FTX in Washington, DC. Prosecutors have revealed eight criminal counts against the FTX founder, accusing him of various securities and derivatives law violations. McKenzie’s journey into investigating cryptocurrencies began during the COVID-19 lockdowns when he found himself out of work and feeling down. Intrigued by the potential of cryptocurrencies, he teamed up with journalist Jacob Silverman to delve deeper into this new financial frontier, leading to the publication of their book, “Easy Money: Cryptocurrency, Casino Capitalism, and the Golden Age of Fraud.”
McKenzie, best known for his role as heartthrob Ryan in the early 2000s teen drama “The OC,” discovered a world of wild promises, eccentric characters, and questionable economic foundations within the crypto industry. Motivated by his findings, McKenzie aimed to expose why an unregulated and unproven financial system was generating vast wealth.
“Easy Money” explores not only the meteoric rise and fall of cryptocurrencies but also their historical context as economic bubbles. The book examines how the inherent inequalities of the traditional financial world made the allure of crypto’s sales pitch irresistible. McKenzie emphasizes that people’s distaste for regulated systems made them vulnerable to manipulation.
During a Q&A session, McKenzie shares his insights on the flaws of cryptocurrencies:
Q: What do you think is wrong with crypto?
A: Crypto claims to be a currency, yet it fails to function as one. You can’t use crypto to purchase goods directly; it primarily serves as an investment vehicle. Crypto is essentially an outdated form of money disguised as the future. We’ve already seen the failure of private money issuance when companies defrauded people.
Q: Crypto seems to appeal to those who distrust governments and institutions.
A: The timing of Bitcoin’s emergence coincided with the subprime crisis in 2008, leading to widespread hatred for banks and institutions. The idea of a peer-to-peer currency was compelling, but trust is the foundation of money. If I handed you a $20 bill issued by my name, you’d dismiss it, but one issued by the United States government holds value because of trust.
Q: Doesn’t crypto offer the advantages of digital money?
A: Crypto enthusiasts often mention digital money, but what they truly desire is pseudonymity, the ability to obscure trading identities. While secrecy may be appealing, it comes at a significant cost. If the good guys can exploit it, so can the bad guys.
Q: Isn’t blockchain technology a groundbreaking improvement?
A: Blockchain has been around since 1991 and is merely a distributed ledger, nothing truly revolutionary. I challenge you to name a company outside of the crypto sphere that effectively utilizes blockchain technology. As an actor with an economics background, I admit that this was my greatest misunderstanding.
Q: Did your acting career influence your perception of crypto?
A: Crypto is all smoke and mirrors, similar to the tale of the emperor’s new clothes. Only those in positions of power can see its value. If you struggle to comprehend crypto, they make you feel stupid. It’s one of the oldest cons in the world, but it has proven highly successful when combined with the dissatisfaction people feel toward our flawed financial system. Celebrities endorsing crypto products are infuriating, as it reveals the industry’s attempt to manipulate and expand its reach.
Q: So what happened to crypto?
A: Crypto reached its peak during the 2022 Super Bowl, with countless celebrities endorsing it. However, the subsequent year saw minimal growth in the number of participants. Soon after, the Federal Reserve started increasing interest rates, causing crypto’s rapid decline. While causality cannot be definitively proven, the correlation suggests economic factors were at play.
Q: Will the current price correction be enough to impact crypto?
A: No, the crypto industry resembles an online casino, relying on regular people to keep the system afloat. However, since many individuals lost money, they are unlikely to return. The industry is spiraling downward, and even for a bubble, this decline is remarkably swift. We may have another six months to a year before we witness its eventual outcome.
Q: What is the lesson we can learn from this?
A: The rise and fall of crypto demonstrate the power and dangers of false narratives. While it shed light on the flaws of our financial system and institutions, crypto itself was a deeply flawed and unsustainable idea. Its temporary success relied on a compelling story and exploiting existing inequalities. Ultimately, the true value lies in recognizing the problems within our system.
Jonathan Lansner is the business columnist for the Southern California News Group. Contact him at [email protected].
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