Jack Ma, the co-founder of e-commerce giant Alibaba, issued the warning about bitcoin while speaking at an event in Hong Kong.
He said he was in favour of blockchain technology, but reiterated caution to people considering investing in bitcoin.
Mr Ma told reporters: “Blockchain technology could change our world more than people imagine.
“It must be used to solve data privacy, security and sustainability issues.
“Technology itself isn’t the bubble, but bitcoin likely is. It is not right to become rich overnight by betting on blockchain.”
He issued the warning as bitcoin’s price continues to tumble after several high-profile hacks against exchanges.
Investors have sold off their coins to keep their money safe after attacks on South Korean exchanges Bithumb and CoinRail.
The market was still in its bear cycle in mid-June but the continued breaches have seen big losses across the market.
Bitcoin rose more than 1,300 percent last year to a high near $20,000.
However, the volatile currency’s value has fallen by 50 percent to around $6,280, according to CoinDesk.
But Luis Carranza, founder of London Fintech Week, insisted there are plenty of reasons to be “optimistic” about bitcoin.
He told Express.co.uk last week: “Cryptocurrency is unpredictable. There are massive spikes and drops.
“$4500 could be the bottom, but there is nothing preventing $2500 from being the bottom.
“Likewise, as crypto becomes more mainstream the price tends to rise. Even if the price drops to $1000 there’s nothing preventing another surge to $14,000.”