Speaking to the media in Tokyo on Wednesday night, legendary investor and Berkshire Hathaway CEO Warren Buffett dismissed bitcoinas a gambling token with no intrinsic value.
Despite Bitcoin’s lack of fundamental value, Buffett noted that people are still attracted to Bitcoin like moths to a flame, eagerly participating in the speculative roulette wheel due to their innate desire for quick profits.
Buffett, on the other hand, advocates slow and steady accumulation of wealth. When asked to predict the end of the bitcoin bubble, Buffett likened it to predicting when speculation, or the inherent human instinct to gamble, will die. He admits that he is not good at making such predictions, because his specialty is investing in good companies. However, he believes that Bitcoin will die when more people want to exit the market rather than enter it.
Buffett’s skepticism about Bitcoin is not new. He has criticized the cryptocurrency in the past, calling it square rat poison and saying it has no value.
Despite the growing popularity of bitcoin and other cryptocurrencies, Buffett remains adamant that they are speculative assets without any underlying intrinsic value. He has warned investors about the risks of investing in cryptocurrencies, warning that they are highly volatile and could be subject to extreme price swings.
Buffett’s views on bitcoin stand in stark contrast to the enthusiasm of some investors who see it as a revolutionary form of digital currency that could upend the traditional financial system.
Proponents of Bitcoin argue that it offers advantages such as decentralized transactions, low transaction fees and protection against inflation. However, Buffett remains unconvinced, arguing that Bitcoin is purely speculative in nature.
Buffett’s investment philosophy is based on a long-term, value-oriented approach, and he seeks to invest in high-quality companies with competitive advantages and a strong track record of earnings and dividends.
He managed to amass his wealth through prudent investments in companies such as Coca-Cola, Apple and Bank of America. Buffett often stresses the importance of investing in what he understands, calling bitcoin a “mirage” that doesn’t meet his investment criteria.
Buffett’s comments on bitcoin come as the cryptocurrency market is experiencing wild volatility. The price of bitcoin and other cryptocurrencies has been volatile, attracting enthusiastic investors and speculators.
Despite its volatility, Bitcoin has gained mainstream attention and is increasingly being adopted by some companies and institutional investors. However, Buffett’s comments are a reminder of the risks and uncertainties associated with investing in cryptocurrencies, especially for those who may be tempted by the lure of quick profits.