The many map breaks * like * the Citi bitcoin report

Citi posted a classic of all time of a report on bitcoin yesterday, which you may have already read about here. And when we say classic, we mean one of the most explosive pieces of propaganda disguised as “research” that we have ever encountered.

Not only was this “report” actually just a massive bitcoin-shilling exercise, it also contained some really embarrassing mistakes from what is supposed to be one of the best banks in the world (and their “foremost thought-leadership” division on it ).

The mistake that was probably most shocking was the obvious failure of the six Citi analysts who wrote the report to understand the difference between base points and percentage points. As an update, the report said the following about illegal transactions in bitcoin and then went on to compare it with those made on regular credit and debit cards:

The scope of such activity can often seem excessive based on news headlines alone. In total, just over 2% of the activity in the cryptocurrency space was linked to illegal activity in 2019 and the total level was only 0.3% in 2020.

To put that figure in context, a payment study commissioned by the Federal Reserve found that fraud represented 13.46% of total credit and debit card network activity in the United States.

As it turned out, The Fed study they refer to actually said that fraud represented 13.46 points – only the 100-fold difference, then. So we pointed this out to Citi, who told us that they would correct the report, and they remained true to their word. Here are the new graphics that put things right:

Funny, right? Why did Citi not write the “13.46bp” figure as “0.1346%” to make the comparison easier to see? It’s almost as if they will their readers to be confused with this violation of charts. Also note the text at the top of the image, especially this bit:

Security problems with cryptocurrency occur, but compared to traditional payments it works better.

Doesn’t work right now, does it? They must have been under pressure for some time. Thus, the passage in the main text now reads:

In total, just over 2% of the activity in the cryptocurrency space was linked to illegal activity in 2019 and the total level was only 0.3% in 2020.

To put this figure in context, a payment study commissioned by the Federal Reserve found that fraud represented 13.46 basis points for total credit and debit card network activity in the United States.

So the numerical error is fixed but not the implication. Absolute jokers.

And now that we’ve got the word out, look at some of the other charts in the report. We let the charts talk:

Later we get another version of the chart:

They must have been quite happy with the “North Star” idea. The term is used 18 times in the report.

Then there are:

And:

And:

Oh, and we should just leave you with Citi’s “confirmation” – they’re kind enough not to take All praise for their steamy pile:

As we prepared to write this report, we concluded a series of interviews [sic] with the CEO’s [sic] and professionals in some of the leading custodians, leading brokers, stock exchanges, infrastructure and asset management companies, in addition to selected experts within Citi. We thank them for all their sharing [sic] knowledge and expertise.

We would also like to thank these “CEOs” and “professionals of some of the leading guardians” for “sharing their knowledge and expertise” and for ensuring that all views were covered, so we leave you with a picture of really comprehensive gang Citi chose for its report:

Related links:
Hi Citi, your bitcoin report is embarrassingly bad – FT Alphaville
Awful shoulders – FT Alphaville