Legendary venture capitalist Fred Wilson has issued an open response to Warren Buffet’s recent claim that bitcoin is equivalent to “rat poison squared” is fundamentally flawed. The American investing tycoon, Wilson said, has not done his research.
Why Bitcoin Has Value
Speaking at the Consensus 2018 conference in New York City, Wilson said that the true value of the bitcoin ecosystem would accrue to the protocol itself and not the businesses that build on top if it. He stated that Buffett hasn’t “taken the time to really understand what’s going on here” before saying that his firm, Union Square Ventures, is making highly speculative bets but that it would “all work out”.
Wilson, whose funds hold investments in web 2.0 businesses like Twitter, Tumblr, and Kickstarter, did caution that some of the current valuations of existing tokens are inflated. He went on to say that they will not represent a good deal even years from now.
Wilson went on to say that he thought governments would attempt to control cryptocurrency and would enjoy some success, but said that they wouldn’t be able to undo the work that has already been done, likening it to trying to “put the genie back in the bottle”.
Wilson was responding to billionaire Buffett’s recent comments, made during the Berkshire Hathaway annual shareholder meeting at the beginning of the month, when he described bitcoin as being “rat poison squared” and said that bitcoin “is creating nothing”.
His comments drew a lot of criticism, not only from blockchain entrepreneurs but from respected businessmen and venture capitalists like Wilson himself. However, those opinions are shared, at least to some extent, by the likes of Bill Gates and most major banks.
Following the meeting, Wilson posted an open letter on his AVC blog, and he repeated his comments when speaking during the annual Consensus conference this week. He stated that Buffett dislikes bitcoin because of the lack of cash flow for the underlying networks. He hinted that Buffett’s investment style is that of investing in businesses, and because bitcoin is decentralized there is no underlying business in which Buffett can invest. That, Wilson posits, is why Buffett has been put off by the idea.
Wilson did temper his comments with some words of caution, saying that he expected governments to have some success in rationalizing and, ultimately, regulating the industry but said that the ICO market is half-way to a new capital market.
Source :- Satoshi.press