On Monday, May 7, 2018, Bill Gates stopped by the squawk Box of CNBC with some strong words for digital currencies and those that believe it has the power to change the world. Bill Gates has a strong opposition to bitcoin, as well as other digital currencies, that the only involvement he had with it resulted from a birthday gift – which he even sold a couple of years after.
What Bill Said about Digital Currencies
The billionaire philanthropist and co-founder of Microsoft said that the major reason why he rejected these new digital currencies is that they do not have any tangible worth. He said: “As a class of asset, you aren’t producing anything so you should not just expect it to go up.
He classified this kind of investment as a “greater fool theory” investment. He is talking about an economic theory in which the prices of items are not dependent on the actual value of the items, but rather, by the expectation and collective beliefs of the participants in the stock market.
Why Gates Said Digital Currencies Have No Tangible Worth
He said oil has tangible worth, and it can be demonstrated easily – you can use it to run a car, power cities, generate heat in the winter, and many more. Bitcoin and other digital currencies are just digital codes, hence, they are susceptible to fluctuation depending on the unreliable options of the trading stock of everyone.
While it looks like Bill Gates is solely anti-cryptocurrency here, he did acknowledge the fact that the blockchain technology behind digital currencies has some value. The blockchain technology is what provides secure 2-way connections allowing the completion of transactions without an interference from a bank.
While the digital currency evolution is pretty much in its early days, and it’s far too early to articulate how massively this new type of currency will affect the status quo, the opinions of Gate should be taken with a grain of salt and strongly considered simultaneously.