Warren Buffett Predicts ‘Bad Ending’ for Cryptocurrencies
Published on January 14, 2018 at 05:24AM
“97% of all bitcoins are held by 4% of addresses,” reports Credit Suisse (in an article cited by Slashdot reader CaptainDork). And elsewhere this week, Warren Buffett told CNBC that speculation in bitcoin and other cryptocurrencies “will have a bad ending,” adding that looking out five years he’d gladly bet against all of the cryptocurrencies.
Meanwhile, CNBC senior analyst Ron Insana has his own skepticism:
I am predisposed to view them as just speculative tokens in a cryptocurrency bubble that has inflated more quickly than any other in financial market history. Admittedly I’m green with envy for failing to foresee the explosive rally in the price of bitcoin when it was first brought to my attention several years ago. Having said that, there are many things I find quite ironic about how bitcoin and other “cryptos” are described. First, they are largely denominated, or discussed, in U.S. dollar terms… If the dollar is archaic, as the crypto-enthusiasts believe, why not speak only in crypto-terms…?
It’s much easier to buy and sell dollars, stocks or commodities than it is to trade bitcoin and its brethren. The conversion of one crypto to another is relatively easy on these embryonic exchanges. But getting your digital wealth converted into cold hard cash is more problematic… And while the growth has been impressive, it remains very difficult to walk into any establishment and exchange a digital token for goods or services.
The article notes that the U.S. dollar still accounts for 65% of all global economic transactions, due to its status as the world’s reserve currency, and concludes that “The adoption of cryptocurrencies as a global source of funds has a long way to go before staking a claim to the world’s economy.”
Read more of this story at Slashdot.