The chairman and chief executive officer of Berkshire Hathaway, Warren Buffett, has taken another swipe at bitcoin (BTC) reiterating an earlier warning that investors in the virtual currency will come to regret someday. According to Buffett purchasing bitcoin or other virtual currencies does not constitute investing but rather it is speculative gambling.
“The asset itself is creating nothing. When you’re buying nonproductive assets, all your counting on is the next person is going to pay you more because they’re even more excited about another next person coming along,” Warren Buffett told CNBC on the sidelines of the annual shareholder meeting of Berkshire Hathaway.
‘Rat poison squared’
According to Becky Quick a reporter for the CNBC Buffett branded the largest cryptocurrency by market capitalization ‘rat poison squared’. The longtime business partner of Buffett, Charlie Munger, compared the leading virtual currency to turds that are being traded by people suffering from dementia. Earlier in the year Buffett had also blasted digital currencies warning people to stay away from them.
Unlike Buffett though younger billionaires in the tech sector have been more optimistic with regards to virtual currencies. This includes Tim Draper, a venture capitalist; Peter Thiel, co-founder of payment services firm PayPal and Jack Dorsey, the chief executive officer of Twitter and Square. These billionaires are convinced that digital currencies are here for the long-term and will displace fiat currencies with time.
Draper is so confident of the rise of bitcoin that he sees the cryptocurrency rising to $250,000 in the next five years. This was not the first time Draper was making a prediction about the virtual currency. In 2015 Draper had forecast that by the close of 2017 the price of bitcoin would rise above $10,000. This came to pass and even surpassed his target. However the price of the digital currency has since then fallen below $10,000.
The venture capitalist’s bitcoin holdings are estimated to be worth hundreds of millions of dollars. In 2014 Draper bought bitcoins numbering 30,000 that had been confiscated by U.S. Marshalls Service during a criminal raid. At the time he bought each of the coins at $600 apiece.
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