Former PayPal CEO Bill Harris Says Bitcoin Headed Straight to Zero

Founding PayPal CEO and former Intuit CEO Bill Harris, who previously had called Bitcoin a “colossal pump-and-dump scheme, the likes of which the world has never seen.” Appeared on CNBC’s Fast Money, this time calling Bitcoin a cult and says it is headed straight to zero.

Brian Kelly debates Bill Harris to look beyond the tokens

As Bill appeared on the show to make is points on negatives of Bitcoin and cryptocurrencies, he was faced by Brian Kelly who kept a positive stance countering every point Bill made getting into a healthy debate

#Bitcoin bulls beware. Former PayPal CEO Bill Harris calls the #crypto a cult and says it is headed straight to zero. pic.twitter.com/SQgf6pIEVk

— CNBC’s Fast Money (@CNBCFastMoney) August 14, 2018

Bill started his comments by saying that he sees bitcoin very close to zero, as many believe bitcoin is instant, free, scalable, efficient, secure, globally accepted and useful but it is none of these. He says the even though the problem statement for cryptocurrencies is correct that it one needs to find an answer to slow and expensive ways transfer money cross-border, one doesn’t need bitcoins or XRP’s but faster networks. To prove his point, Bill compares Bitcoin capability of processing 7 transactions per second to Alipay 250 transactions per second. According to him, countries like India and China have better real-time payment systems reducing bitcoins use case there. He says any investment opportunity is a good opportunity if it does better than the alternatives and bitcoin doesn’t fall in the bracket. He adds that

“The Volatility of Bitcoin itself makes it a useless payment mechanism and ridiculous as a store of value”

While Bill Harris criticizes the bitcoin, Brain Kelly was up to the task of countering every negative claim made. According to him, PayPal isn’t safe either as Russian hackers had bought all kinds of google ads by hacking PayPal. He added that all the qualities mentioned regarding bitcoin such as instant free scalable efficient secure may not be felt today but these are the catalyst for the future one the technology matures. According to him bitcoin or cryptocurrencies are software programs that allow users to disintermediate parts of financial service is where the value lies. On being questioned as crypto still has limited uses cases,

Kelly said that this is where all the investment opportunity is and will have a multiplier effect as the use cases increase and so does its scalability. Kelly compares cryptos to gold saying that Gold doesn’t have a use case anymore still it is USD 1200 an ounce. He also added that in nascent years no one thought that Amazon would be streaming content today on handheld computers as originally it was a website selling books and DVDs.

Countering Bill’s volatility claims Kelly stated

“Oils speculation to use case is 96:1 but bitcoins speculation to use case is 2.5:1 and as that speculation increases the volatility will decrease”

Also, read: Bitcoin in Danger of Crashing to $1000 in the Long Term, says Wall Street Strategist

Harris has been a bear as far as cryptos are concerned

Although crypto community might not like Harris’s comment his experience with Financial technologies cannot be underplayed. How much of it would be true is only in the hands of time but his article calling bitcoin a scam is definitely worth a read. To pick up specifics from his articles on use cases bill mentioned in his article on Recode that “Promoters claim cryptocurrency is valuable as (1) a means of payment, (2) a store of value and/or (3) a thing in itself. None of these claims are true” Following are his point he put forward to prove his stance.

1. Means of Payment. Bitcoins are accepted almost nowhere, and some cryptocurrencies nowhere at all. Even where accepted, a currency whose value can swing 10 percent or more in a single day is useless as a means of payment.
2. Store of Value. Extreme price volatility also makes bitcoin undesirable as a store of value. And the storehouses — the cryptocurrency trading exchanges — are far less reliable and trustworthy than ordinary banks and brokers.
3. Thing in Itself. A bitcoin has no intrinsic value. It only has value if people think other people will buy it for a higher price — the Greater Fool theory.”

As this article surfaced in May 2018 and a lot of it changed since then, these points definitely give an insight on what an investor would look for to turn him from bear to bull. This is sought of a roadmap that every project owner should keep his or her eyes on.

Will Bill Harris be proved wrong in his claims? Do let us know your views on the same.