Warren Buffett Finds Buyers of Bitcoin “Rat Poison Squared”
Warren Buffett, the Chairman, and Chief Executive Officer of Berkshire Hathaway Inc said that the buyers of Bitcoin thrive on hopes of finding other people willing to pay more for the cryptocurrency. He has characterized the buyers of Bitcoin as “rat poison squared” due to this very nature of the buyers of the cryptocurrency.
The Billionaire investor finds the demand for the cryptocurrency similar to the Tulip Bulb Mania of the 17th century Holland. He said that it is the mystique behind Bitcoin which has caused the BTC price to rise. Buffett said on CNBC television:
“If you don’t understand it, you get much more excited. People like to speculate, they like to gamble.”
According to Buffett, the investors would be much better off trading and owning stocks. Even though the prices of the stocks are elevated, the stocks aren’t in a “bubble” which makes him say that he would take a “nanosecond” to choose stocks even over US government bonds.
The Berkshire Vice Chairman, and Buffett’s business partner, Charlie Munger, is no Bitcoin fan either. He describes the cryptocurrency as “worthless artificial gold” and compares it to Oscar Wilde’s definition of fox hunting—the pursuit of the uneatable by the unspeakable.
Of recently, Bill Gates, the principal founder of Microsoft, criticized Bitcoin by saying that he would “short it if there was an easy way to do it.” He said on CNBC’s “Squawk Box”:
“As an asset class, you’re not producing anything and so you shouldn’t expect it to go up. It’s kind of a pure ‘greater fool theory’ type of investment…Bitcoin and ICOs, I believe completely [they’re some] of the crazier, speculative things.”