As cryptocurrencies hit their lowest level since their inception in June, detractors of digital assets are picking up steam, and its defenders are getting quieter.
Bill Gates, who falls into the former category, regularly criticizes the economics of NFTs and cryptocurrencies. At a Tech Crunch climate conference in Berkeley in June 2022, he claimed that digital currencies were based on the Biggest Fool Theory.
According to this theory, prices are driven up only because a seller will find a buyer, described as the biggest fool, who can buy an item from him at an ever-increasing price, regardless of whether that item is overvalued. The cost of bitcoin has risen to new heights as buyers have been able to pay large sums of money for it, allowing the holders of the virtual currency to offer astronomical prices.
Cryptocurrency holders are betting that they will be able to find buyers to pay the asking price even though the digital currency has no value and earns no money for society, as Bill Gates likes to point out. The founder of Breakthrough Energy Ventures, a 2015 climate-focused fund, is also critical of the environmental impact of cryptocurrencies.
Bill Gates’ criticism also extends to NFTs, digital art protected by a blockchain, sarcastically stating that expensive images of monkeys will vastly improve the world, referring to the NFT Bored Ape Yacht Club collection created in 2021. Since then, like cryptocurrencies, NFT collections have seen their value plummet.
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