Cryptocurrency is a Delusion According to Warren Buffett

Warren Buffet, one of the world’s most successful investors, says Bitcoin is a “delusion” and has “no unique value.” He’s been a long-time critic of Bitcoin, which was trading at about $3,700 early this week.

Before the 2018 Berkshire Hathaway annual shareholder meeting, Buffett commented that Bitcoin is “probably rat poison squared.” He’s made a clear distinction between the technology behind Bitcoin and the currency, however. He says blockchain probably has important potential, but it’s not dependent on cryptocurrency for its success. Buffett’s criticisms are rooted in his belief that cryptocurrency isn’t producing anything. He says you just have to hope that the next investor is willing to pay more.

Fund managers Howard Marks and Ray Dalio have also questioned Bitcoin’s legitimacy. Other famous critics of the currency include Bill Gates, Robert Shiller, and Nouriel Roubini. Jamie Dimon, J.P. Morgan’s CEO, was vocal about his distaste for Bitcoin, but the bank just launched the first proprietary cryptocurrency for cross-border payments.

Bitcoin peaked during December 2017 at about $20,000. It’s since lost 80% of its value. Warren Buffett created a net worth of more than $87 billion with his tried-and-true investment techniques. His company, Berkshire Hathaway, lost $4.3 billion last Friday when Kraft-Heinz stocks dropped 25% following a disappointing earnings report.

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5 years ago