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Despite the steady growth in Bitcoin’s value, popularity, and mainstream acceptance, Berkshire Hathaway CEO Warren Buffett recently took yet another dig at the leading cryptocurrency by market capitalization.
While addressing his company’s annual shareholder meeting, the world’s sixth-wealthiest person claimed that Bitcoin isn’t a “productive asset,” it doesn’t produce anything “tangible,” and that he won’t even pay $25 for all the Bitcoin that is currently in circulation.
According to Warren Buffett, “If you said … for a 1% interest in all the farmland in the United States, pay our group $25 billion, I’ll write you a check this afternoon,” Buffett continued, “[For] $25 billion I now own 1% of the farmland. [If] you offer me 1% of all the apartment houses in the country and you want another $25 billion, I’ll write you a check, it’s very simple. Now if you told me you own all of the bitcoin in the world and you offered it to me for $25 I wouldn’t take it because what would I do with it? I’d have to sell it back to you one way or another. It isn’t going to do anything. The apartments are going to produce rent and the farms are going to produce food.”
This isn’t the first instance where Buffett has put his hostility towards Bitcoin on full display, blaming it for having no intrinsic value. He had previously called Bitcoin a “delusion” and “rat poison squared,” – which drew sharp criticism from several crypto industry leaders.
Things are no different this time around.
The Community Responds
After Buffett’s statement, the crypto community has been quick to point out that there is a diverse range of use cases and utility in cryptocurrencies that the 91-year-old billionaire hasn’t likely stumbled across or researched yet.
Well-known crypto proponents took to Twitter to mock Buffett’s minimal awareness and understanding of cryptocurrencies in general. For instance, Marc Andreessen of venture capital firm Andreessen Horowitz (a16z) shared the original clip on his Twitter account, saying, “it’s so wild he says this stuff while nakedly shilling diabetes.”
Meanwhile, Tesla and SpaceX CEO Elon Musk replied to the tweet, noting, “haha he says ‘Bitcoin’ so many times.” MicroStrategy CEO Michael Saylor also joined the fun, adding, “everyone can’t stop talking about Bitcoin.”
Jokes aside, it is quite evident that cryptocurrencies have multiple utilities – something the likes of Warren Buffet and Charlie Munger are either unaware of or are deliberately willing to overlook.
Talking about the real-world utility of Bitcoin, Santiago Sabater, CEO of DefiChain Accelerator, explains, “Bitcoin is a hedge against monetary systems that are controlled by single authorities and states. It’s giving people a choice – in other words: freedom & privacy. Bitcoin itself is the most efficient store of value. Bitcoin doesn’t know national borders, it’s always accessible, it’s censorship-resistant, and you never need to rely on anyone before doing a transaction.”
He adds, “Trust and security is exactly what’s driving Bitcoin’s network. Trust is everything – without trusting the USD no one would use it, right? It is the biggest and most secure Blockchain in the world and this is a crucial argument for new people who are exploring the crypto industry and want to get involved.”
Highlighting the benefits of Bitcoin over existing systems, Narek Gevorgyan, CEO & Founder of CoinStats, notes, “Despite the talk about energy consumption, Bitcoin is one of the most efficient networks because it has the right mix of incentivization to encourage participation. Users can transact with each other on a near-instantaneous basis, exchanging value in a boundaryless manner. At the same time, miners are incentivized to provide the computing power and security needed for users to transact in a trustless environment.”
Like any other blockchain proponent, the CEO of CoinStats also believes that Bitcoin has huge potential to improve upon traditional financial systems. He explains, “The right mix of traditional financial products alongside the Bitcoin network’s inherent features can help both TradFi and DeFi reach new heights. Compared to existing financial solutions, Bitcoin delivers noteworthy benefits, particularly in terms of accessibility and inclusivity. Sure, some work needs to be done about its scalability (transaction speeds and fees). But it’s a work in progress as several layer-2 scaling solutions, sidechains, and other improvements play a larger role in addressing these challenges.”
Likewise, DefiChain’s Sabater is also optimistic about the future of Bitcoin. Although he accepts that Bitcoin is still in its infancy, he is positive that scalability-focused solutions like the Lightning Network are adding powerful use-cases for millions of users, companies, and customers by facilitating instant transactions between customers and service providers.
He concludes, “The adoption of the lightning network from big players like Walmart, McDonalds & more is just beginning. Additionally, we just saw the first states adopting Bitcoin – but many will follow. I truly believe that once Bitcoin is growing to a specific point, we will likely see a competition between states that are trying to acquire as much Bitcoin as they can to use it as collateral for their fiat currencies – as they did with gold.”
