Dec 28, · Warren Buffett Called Bitcoin 'Rat Poison' — Now It's Closing In On Berkshire Hathaway's Valuation U.S. stocks still seemed expensive even after the bursting of the dot-com bubble and the Author: Chris Katje. Bitcoin, Warren buffett on Bitcoin bubble and other cryptocurrencies are “stored” victimisation unrivaled of the statesman reasons for the claim is the finite assets of Bitcoins, production it A neat memory board of value (only 21 meg Bitcoins) and infectious agent adoption around the sphere. Warren Buffett is not a believer of bitcoins and thinks of it as “real bubble.” Here is where he gets it right and wrong. According to The Coin Telegraph, Buffett stated that bitcoin is a bubble.“You can’t value Bitcoin because it’s not a value-producing asset,” he added.
Warren buffett on bitcoin bubbleBitcoin is a bubble: Where Warren Buffett gets it right and wrong
Or he invests in real estate. A piece of vacant land won't produce anything, of course, but you can build an apartment complex and produce income by charging rent.
While bitcoin is intended to be a digital currency, its actual use as a payment system remains extremely limited. Buffett believes bitcoin is valuable only because the person buying it thinks they'll be able to sell it for even more than what they paid at some point. Buffett has said Berkshire's favorite holding period is "forever. Bitcoin isn't exactly a buy-and-hold investment. Ultimately, Buffett is fine with it if you want to buy yourself some bitcoin.
Just don't call it investing. Just how much illegal activity does bitcoin facilitate? That's a matter of widespread dispute. But its role in darknet drug marketplace Silk Road, its use for money laundering and trafficking stolen goods, and recent reports that it's been used to finance terror plots haven't exactly been great for bitcoin's image. Buffett has made it clear that he'll never tolerate anything that would jeopardize Berkshire Hathaway's reputation.
A frequently quoted Buffett-ism: "Lose money for the firm, and I will be understanding. Lose a shred of reputation for the firm, and I will be ruthless. Buffett has taken past jabs at bitcoin's reputation for financing criminal activities.
He told CNBC in that its only economic contribution may be to cut the demand for suitcases — because rather than lugging around money-stuffed suitcases, criminals can just use bitcoin.
One of Buffett's best investment lessons : Never invest in something you don't understand. The mechanics of bitcoin, how you mine it, and how its deregulated network functions are extraordinarily confusing, even for the tech-savvy.
So it isn't surprising that Buffett takes a hard pass here. Buffett has said repeatedly that he believes cryptocurrencies will end badly. The problem is, he has no clue when. Keeping with his rule of investing in what he knows, Buffett will never bet money by shorting cryptocurrencies, either. Investing Best Accounts. Stock Market Basics. Stock Market. Industries to Invest In. The price of bitcoin and other major cryptocurrencies fell sharply Thursday after South Korea's justice minister announced that a bill is being prepared to ban all cryptocurrency trading in the country, citing concerns regarding virtual currencies.
But those declines pale in comparison to bitcoin's more than 1, percent surge in the past 12 months. Skip Navigation. Markets Pre-Markets U. Key Points. Warren Buffett was right to warn about bitcoin and other cryptocurrencies, a veteran investor says.