Warren Buffett is not a believer of bitcoins and thinks of it as “real bubble.” Here is where he gets it right and wrong.
According to The Coin Telegraph, Buffett stated that bitcoin is a bubble. “You can’t value Bitcoin because it’s not a value-producing asset,” he added.
Buffet unimpressed by cryptocurrencies
Buffett is no stranger in criticizing bitcoins. Back in 2014, he said it’s a joke to think that cryptocurrencies have any intrinsic value because they are just mere modes of transmitting money. Since then, the value of bitcoins continued to reach record levels. Earlier this month, bitcoin was trading at about $4,300, but its price surged to over $6,100 on Oct. 20.
Just like any bubble, once it reaches its peak, a crash in prices will happen next. Market speculations drive Bitcoin prices, and proponents believe the prices will only get better as time goes by. “Speculation is most dangerous when it looks easiest,” claims Buffett in a Berkshire Hathaway letter he wrote.
Buffett is also not a fan of things he does not understand. Per DMarket, he admitted that he does not understand the business models of tech companies such as Google and Amazon. With bitcoin being relatively a new form of digital currency, it could be probable that the Oracle of Omaha simply overlooked the advantages that it brings.
Other billionaires weigh in on Bitcoin
Other billionaire investors have also released strongly worded statements about the cryptocurrency. Dallas Mavericks owner and Shark Tank member Mark Cuban agreed with Buffett that bitcoin is a bubble. He added that one of the clear indications of it being a bubble is how people boast about being able to easily make money out of it. However, he lauded blockchain for its many applications such as in healthcare and finance.
Billionaire investor Howard Marks went as far as describing bitcoin as a fad. He even compared the hype to tulip mania, the South Sea bubble and the internet bubble.
Richard Branson’s views are a bit more welcoming than his peers with regard to bitcoins. He recognizes the volatility that surrounds it and thinks other cryptocurrencies will arise in the future.
Prince Al-Waleed bin Talal of Saudi Arabia suggests that bitcoin will implode soon because it is not regulated. While being free from regulations is one of the advantages of bitcoins, some are claiming it is also one of its weaknesses. Without regulations, it can easily be manipulated and used in underground activities.
Because account owners cannot really be traced, bitcoins are the favorite ransom of hackers. Hackers demanded about $6 million worth of bitcoins for Game of Thrones’ leaked episodes. The Ransomware and Equifax hackers also preferred bitcoins.
Count infamous “Wolf of Wall Street” Jordan Belfort, who was convicted of fraud, among those who will not get on the bitcoin hype. He said that initial coin offerings or ICOs are “the biggest scam ever.” ICOs are used by startups to generate funds. It will depend on the success of the startup how ICOs can increase their value. Belfort added that while the intention might not be entirely bad, it is not entirely good either.
Encomenda Invests €200,000 to Launch Telemedicine Startup Doctomatic
The fund led by Carlos Blanco and Oriol Juncosa has helped launch this new digital platform, called Doctomatic, for remote...
Burkina Faso: The European Investment Bank Strengthens its Partnership with CAPE
According to the Director-General of CAPE Burkina, the support of the EIB is one of the major factors that has...
The First Four Projects of the Civic Crowdfunding of Venice Were Launched
The first four civic crowdfunding projects in Venice were launched. The project "ONDEW - Let's face climate change together", is...
What Fintech Trends Set the Agenda for 2021 in Argentina
The fintech sector in Argentina has strongly developed during the pandemic. There are 238 fintech companies, i.e., almost three times...
Why Plant-Based Meat Could be the Future of the Food Market
Despite this incredible development and potential, vegetable meat is not the only alternative coming into play in this new era....
Cannabis2 weeks ago
Recreational Cannabis in Argentina, an Unavoidable Debate for the Congress in the Making
Featured2 weeks ago
PwC’s Climate Targets Were Validated by the SBTi Initiative
Crypto2 weeks ago
El Salvador’s Switch to Bitcoin Is Not the Cause of the Price Crash
Business2 weeks ago
Augmented Reality and Flooring in an App: XRA’s Double-Horned Unicorn