Alibaba’s Jack Ma calls bitcoin a bubble

Jack Ma’s Ant Financial is betting on blockchain but the Chinese billionaire warned against the technology’s first and most popular use case: Bitcoin.

The financial-technology affiliate of e-commerce giant Alibaba launched a joint venture in Hong Kong Monday that uses blockchain for a cross-border remittance service. At the launch event hosted by Ant Financial, Ma advocated for blockchain but said the firm does not own bitcoin, and would stay away from the asset class, the Wall Street Journal reported.

“It is…not right to become rich overnight by betting on blockchain,” Ma told reporters at the event, according to the Journal. “Technology itself isn’t the bubble, but bitcoin likely is.”

Bitcoin rose more than 1,300 percent last year to a high near $20,000. This year, the digital currency has fallen 50 percent to around $6,280, according to CoinDesk.

Ma, who is also Ant’s controlling shareholder, said blockchain “must be used to solve data privacy, security and sustainability issues” but that with cryptocurrencies the technology has been turned into “tools and concepts for making money,” the Journal reported.

Ant Financial owns online-payments network Alipay. Ant’s new Hong Kong-based joint venture will facilitate real-time cash transfers between people in Hong Kong and the Philippines in a digital wallet service the company said was the first of its kind. The service is a collaboration with Philippines-based GCash, operated by telecommunications firm Globe Telecom.

Bitcoin was the first application for blockchain technology but it now has countless other use cases. The public ledger used in blockchain cannot be changed or tampered with thanks to complex cryptography backing it.

Read the entire Wall Street Journal report here.