Bitcoin Skeptic Bill Gates Has Harsh Words for Crypto

© The Street

By Luc Olinga

The cryptocurrency market is in disarray. It lost over $2 trillion in eight months.

Bill Gates has never hidden that he was not a fan of Bitcoin and cryptocurrencies.

The co-founder of software giant Microsoft (MSFT) - Get Microsoft Corporation Report has just reiterated his aversion to the crypto industry as the digital currency market is in disarray.

Bitcoin, the king of cryptocurrencies, is now evolving at its lowest levels since 2020. Bitcoin has fallen to the $20,000 level and given the volatility that characterizes this industry, it could drop below this psychological bar in the coming hours.

It was down 9.6% at $20,618.65 as of time of writing, according to data firm CoinGecko.

The cryptocurrency market was only worth $922 billion compared to $3 trillion in November in the midst of the crypto craze.

Gates Doesn't Own Any Crypto

In May 19, Gates made it known on social media Reddit that he does not own any digital currency.

"I like investing in things that have valuable ouput," the billionaire said on Reddit. "The value of companies is based on how they make great products," he wrote. "The value of crypto is just what some other person decides someone else will pay for it, so not adding to society like other investments."

This wasn't the first time the world's fourth-richest spoke out against Bitcoin and the crypto industry. The philanthropist had already expressed some skepticism about Bitcoin in an interview with Bloomberg in 2021.

He had said he was concerned about the general population's enthusiasm for cryptocurrency, and that unless you are wealthy you shouldn't be buying Bitcoin.

"Elon [Musk] has tons of money and he's very sophisticated, so I don't worry that his Bitcoin will sort of randomly go up or down," Gates toldBloomberg. "I do think people get bought into these manias who may not have as much money to spare. My general thought would be that if you have less money than Elon, you should probably watch out."

Elon Musk, CEO of Tesla (TSLA) - Get Tesla Inc. Report, is the richest man in the world, with an estimated fortune of $209 billion as of June 14, according to Bloomberg Billionaires Index. Tesla announced on February 8, 2021 that it had invested $1.5 billion in Bitcoin. But the value of that investment is now $911.47 million with Bitcoin plummeting, according to Bitcoin Treasuries.

'Not Long or Short'

Gates just launched new criticisms against the crypto industry, during a TechCrunch talk on climate change on June 14.

The billionaire believes that crypto projects like nonfungible tokens (NFTs) are shams "based on the greater-fool theory," which usually means that overvalued assets will go up when there are enough investors willing to pay more for them.

"Obviously , expensive digital images of monkeys are going to improve the world," Gates said ironically, referring to the very select and much-hyped club Bored Ape Yatch Club NFT.

NFTs are a way of owning a piece of digital content, be that a photo or a gif. They are built on the Ethereum platform, the biggest in the crypto space and are sold in Ether, the native token of Ethereum.

The prominent Bored Ape Yacht Club has generated more than $1 billion in NFT sales, with celebrities like Snoop Dogg, Madonna, Paris Hilton, and Jimmy Fallon scooping up their own apes.

“I’m used to asset classes ... like a farm where they have output, or like a company where they make products,” Gates said.

As for crypto, “I’m not involved in that,” Gates added. “I’m not long or short any of those things.”