Bill Gates attributes crypto to ‘greater fool theory’

Bill Gates has become the latest crypto detractor to join a growing choir of critics who believe that non-fungible tokens (NFTs) and cryptocurrencies themselves are based on false hope.

Attending a TechCrunch talk on climate change this Tuesday, the Microsoft co-founder said that cryptocurrencies and NFTs are based entirely on “greater fool theory”.

The concept is simple. An asset will only increase its value if there are enough people willing to pay for it. He joked that surely “expensive digital images of monkeys” would improve the world. Gates was referring to the Bored Ape Yacht Club NFT collection, which has become a hit.

Gates seems to align with a line of thought whereby NFTs have become more of a cash-grab than a means to improve the rights of digital artists, for example.

“I’m used to asset classes like a farm where they have output, or like a company where they make products”, Gates said. He admitted that he was not involved with cryptocurrencies, arguing that he had no interest.

While Gates may not be involved, cryptocurrencies can have real knock-on effects. For example, the International Monetary Fund cautions that bringing cryptocurrencies and traditional assets together and creating intertwined banking products could shake the central banking system.

Stablecoins are seen as a challenger to fiat currency, but they seem to bear all the benefits and none of the responsibilities.

Meanwhile, big crypto companies are battening down the hatches against a ‘crypto winter’. Coinbase has just announced it will be cutting its work force by a third, for example.

If you still have fun using cryptocurrencies, though, we recommend that you check out 1xBit, FortuneJack or Bitcasino.

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Updated: 06/15/2022 — 15:00