Early Bitcoin investor, Venture Capitalist and a disciple of Warren Buffet, Chamath Palihapitiya is still bullish on Bitcoin. Chamath who is the CEO and founder of Social Capital has also worked with Facebook during its early days.
Chamath has first bought Bitcoins when it was around $100 even less. Reportedly, he has been accumulating Bitcoins since 2013 and had 5% of all the Bitcoins back then. He still believes that “it is the single best hedge against the traditional financial infrastructure.”
During the bull run of 2017 in December Chamath also saw Bitcoin above $100,000. He told the media back then,
“I think this thing is a $100,000 a coin probably in the next three to four years.”
It seems that his predictions are lining with the other predictions made by Bitcoin proponents which all see Bitcoin to $100,000 sooner than one can expect. He also stands by his predictions of Bitcoin reaching $1 million in the next 20 years, which he made in 2013.
Nevertheless, critics continue to raise doubts on the adoption rate of Bitcoin and it’s lack of inherent value. Joe Kerner from Squackbox pointed out that Bitcoin should be used for its inherent value as a decentralized, immutable public distributed ledger, while the price is currently rising on the pretext of the fall of the economy. Hence, there seems a strong discrepancy between the reason for the rise.
However, Chamath was consistent with his believe in Bitcoin more as a hedging instrument than anything else. He told the media,
“This is now a confidence game. There is no real utility in this. This is a fantastic fundamental hedge and store of value against autocratic regimes and banking infrastructure that we know is corrosive to how the world needs to work properly,”
The currency wars that the world Governments are currently pursuing by printing large amounts of FIAT currencies, will ultimately have a negative effect on the economy. Moreover, it has created large fiscal deficits in the national economy which can be repaid only by increasing inflation further.
Bitcoin with its limited supply and uncorrelated characteristics is, hence, providing an exit from the system. It provides an opportunity for people to hedge their value against inflation and the declining global economy.
Do you agree with Chamath or do you also share Joe’s doubts? Please share your views with us.
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Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com