Better to spend $25 billion on land than $25 to buy all the Bitcoins in the world, Warren Buffett explains in detail why
In recent years, Bitcoin is gradually being accepted in the world of traditional finance and investment, but for billionaire Warren Buffett, his answer to the invitation to invest in this cryptocurrency is still the same. “No”.
He explained his decision in detail during Berkshire Hathaway’s annual earnings call. That’s because Bitcoin is neither a productive asset nor a tangible product.
“Whether it’s up or down next year, or the next 5 10 years, I don’t know. But one thing I’m sure of, it won’t produce anything,” said Mr. Buffett.It’s like there’s magic attached to it and people often attach magic to a lot of different things.”
Not only that, but Mr. Buffett further explained why he doesn’t see any value in Bitcoin, especially when compared to things that produce other types of value.
“If you say… to get 1% interest on all farmland in America, pay us $25 billion, I’ll write you a check this afternoon. If you say give me 1% of the apartments in the country and want $25 billion, I’ll write you a check right away, very simple.,” said Mr. Buffett.
“But if you say I can own all the Bitcoins in the world for $25, I won’t take it, because what can I do with it? I will have to sell it back to you one way or another. It won’t do anything. Apartments can be rented and fields can produce food.”
“Property, must have value, must give something to people. And only one coin is approved. You can think of all sorts of different things – we can even think of Berkshire coin – but in the end, it’s still money.,” said Mr. Buffett, and pulled out a $20 bill.And there’s no reason for the US government… to let Berkshire’s money take its place.”
For years, investors have wondered how to value Bitcoin in part because of its potential to serve a variety of purposes. In Western markets, many people see it as an investment asset, in other markets, people see it as digital cash.
Many other cryptocurrencies make it possible for users to use them for profitable purposes – for example through rental or escrow – to generate other additional benefits. However, most of them are still young, highly volatile, and not as popular as Bitcoin.
Both Mr. Buffett and his right-hand man, Charlie Munger, have made negative comments about Bitcoin in the past. The most famous is the time Mr. Buffett called Bitcoin “square of rat poison” before.
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