Bitcoin Forum

In his latest visit to his hometown of Omaha, Nebraska, where he hosts a casual event for business students, one of the attendees asked Warren Buffett a question about Bitcoin. As a clarification, Buffett went on to say that cryptocurrencies like Bitcoin are “a very effective way of transmitting money, and you can do it anonymously and all that”, but it doesn’t mean much in the grand scheme of things: “A check is a way of transmitting money, too.

Are checks worth a whole lot of money just because they can transmit money?”. He finished his statement with a harsher criticism of Bitcoin, saying that the “idea that [it] has some huge intrinsic value is just a joke, in my view”.

Buffett tends to lean towards investing in things that have a sustainable inherent value. Meanwhile, Bitcoin is surging past the $8,000 mark even after the SegWit2x drama left its future uncertain.

Although there’s no denying that it’s subject to more volatility than most fiat currencies, there’s a lot to be said about its utility in the market as more stores begin to accept payments in the cryptocurrency. Warren Buffett might not be keen on the idea of pumping capital in Bitcoin’s direction, but other players want a piece of the pie, each for their own reasons.

https://cryptovest.com/news/warren-buffet-the-idea-that-bitcoin-has-value-is-just-a-joke/

As somebody who has read Benjamin Graham's (his professor) books I totally understand the point he comes from.

Bitcoin has a price, but it has no value.

It ins't irreplaceable, it isn't unique, it has no assets, just the consensus around its price which can change any day.

I really wonder how people can truly disagree with the fact that Bitcoin has no "value". Value is an intrinsic property of something. Stocks represent a portion of a business, assets, cash flow, market share, real estate, patents, ecc. Currencies do not represent any of that, not just crypto currencies.

You can't reasonably disagree that BTC has no intrinsic value, but I do disagree with the way that Warren Buffet is presenting his statement.

His alternative to using BTC is using fiat money, which also has no intrinsic value.  So calling out Bitcoin specifically for having no intrinsic value is unnecessary.  He would have to clarify why exactly he believes that fiat money (the alternative) has any intrinsic value either.

He also doesn't understand that BTC is not just a method of transferring money - a cheque is a method of transferring fiat money, while BTC users are transferring an entirely different currency altogether.

Are shares issued by a company unique? Are they irreplaceable? If not do they have value?
Many people see value in things that aren't recognized globally, but traded in small communities, groups of enthusiasts. And those groups can make these things worth a lot of money. For instance stamps, postcards, the market of collectible is more vast than that of cryptocurrencies. What i'm trying to say is that it's not the issuer that makes the item valuable, it's the collector, the buyer, the trader, in other words the community.

Would Warren be jealous of not having had the smell instead?

Well, the problem is, that the majority of the people just smile when you talk about someone who collects postcards, stapms, old coins, etc... becuase they are only a small group of people and they don't know exact things about that. It doesn't matter if they can make profit at the end buying cheap stamps and selling it for higher price next weekend in the club, because it's not in the mainstream media, it's not in the people's mind. This is really similar to bitcoin, where now it's only a few group of people who 'collects' bitcoin and trades it (but not in clubs but on exchanges, and not locally but worldwide). The difference is that bitcoin have the chance to go mainstream, so in that case all of the people will be aware about the price and the value, but I don't know if it's the near future or not.

I’d like to know what he thinks of gold then and if that differs from his opinion over Bitcoin, why that is.
I think he needs to be educated a little more about the underlying technology behind Bitcoin and about Bitcoin itself if he thinks it just stands for a form of transferring money anonymously.
I wouldn’t be surprised if one of his many companies have investments in Bitcoin either. He may be one of the most successful businessman the world has seen but I think he’s a bit mistaken on this front. 

What people also tend to forget is that USD for example is like 90% "crypto" currency as well. Only a small portion of USD is printed or minted, but 90%-95% (can't remember now the exact number) is in digital form. The difference is that central banks can create USD (and other fiats) digitally by pressing a button. But in order to create more Bitcoin you have to use quite a bit of energy to mine it, as it is also criticized by many.

In practice one might say USD has even less value than BTC, when you think of the fact how it's created. However, it has value because the government says it does. One day very soon the whole crypto vs fiat discussion will be meaningless. Governments will win the war-on-cash eventually moving all fiat to digital form as well. By then probably each country will have their own cryptos as well.

I've read a lot of mr. Buffett and I can see where he's coming from.

He has also said many times he doesn't invest into things he doesn't understand. He doesn't master every single thing in the world and I doubt he has any interest to master BTC either. You only see the value in Bitcoin if you understand the bigger picture. Hence, it's easy to see why Buffett (or any investor like that) will make such comments.

I'm also pretty sure that soon every top level investor is one way or another invested in cryptos. Maybe they own them directly in secret or their wife owns them or they own shares in some funds etc. I find it very hard to believe that any greedy investors in this world would bypass this opportunity. I just don't buy that.

A cryptocurrency is a more specific term, defined by the use of cryptography for security.  The digital dollar is a digital currency but not a cryptocurrency.
I disagree with this point because mining BTC does not have an inherent cost.  When mining gold, for example, you would have to spend a certain amount of money to mine it.  This cost would not be affected by the price of gold.

The power and investment dedicated by BTC miners is determined by the price because the block reward stays constant (and the block time roughly constant).  So the cost of mining doesn't give BTC any intrinsic value.
I also find this unlikely.  Buffet is very much a buy and hold investor - he buys things that are usually quite steady and holds them for a long time.  Similarly, a lot of other investors would not be interested in getting involved.

I do not agree with him. Bitcoin is not a way to transmit money as he says like checks could be. It is basically money. Well, exactly in economical terms it is a commodity used as a currency with a face value of the price of this commodity? So at the end it is money. But what he does not get is that it is a third way for money, like fiat or gold were. He is from the old stocks world, he could not understand how something that is not making profits could be worth anything, but what we can only say is that it is too bad for him ! He would avoid huge inheritance fees with Bitcoin, but that is his problem.

Warren Buffett is a genius investor, but he's also 87 years old. I don't blame him for not understanding Bitcoin, and he's always said not to invest in things you don't understand.

I wonder though how he'd respond if someone would ask him why dollars have value.
Allow me to edit his quote (https://cryptovest.com/news/warren-buffet-the-idea-that-bitcoin-has-value-is-just-a-joke/):

I am not surprised to hear this. In fact I won't be surprised if some other banker says even bad words about bitcoin in future. Bitcoin was initially started as a method of payment transfer anonymously and it taught us about the decentralised economy can be a reality.

However, we have now moved to a very different route and using bitcoin as an investment. Even a futures trading contract and hedge fund based on bitcoin is just around the corner. So what Mr. Buffet said may not become a reality. He is the owner of an financial empire called Berkshire Hathaway and he sees bitcoin as a threat to his business. So we need to learn ignoring these mainstream rich investors.

Well he's not wrong.

He has his own metrics with which he assesses investment opportunities, successful ones at that, and Bitcoin happens to fail short in this regard. He doesn't like gold either, so it has neither to do with Bitcoin being a new technology, nor with Bitcoin being a bad investment in itself.

While I disagree with his conclusion I see where he is coming from and he's consistent in his thinking. I respect that. I respect that more than flip-flopping hype-train-jumping Wall Street bankers to be honest.



Warren Buffett made more money investing than he or his descendants will ever be able to spent, I doubt he has reason to be jealous or to feel like he missed the boat ;D

Thosee people who have still doubts on bitcoin really think like that. But when he say that bitcoin has value "It's just a joke" is a very poor reason why he can't believe bitcoin. Is it because it is too much expensive? Or is because it's digital? People will only believe when they already experience it and how to use it.

as far as I know he loves jokes ... it keep$ him alive

There is more to Bitcoin than just a high intrinsic value, it's the solution to a decentralized currency, where there is not central authority. An other feature of that makes Bitcoin unique is it's fixed supply. That makes it different from real fiat currencies where the central bank can bring more units in circulations, unlimited. That's why some people call Bitcoin, digital gold.  

He is great investor, but i think he is too old for understand the new tecnologies.
And old people seems to blame that they cant understand.

Another possibility, if he has any connection with banks, so they don't want bitcoin or cryptos because it can destroy them.

I see his point. However, when Bitcoin is used as an investment method (a working one), does it not create some value? Is it wrong to say your portfolio in bank has a "value"?

A check is a way of transmitting money.

Unfortunately its not a method which would allow a person to maintain the value of their wealth if the euro and dollar crash.

I feel like potential hyperinflation of fiat currencies are the main issue Warren Buffett is avoiding. Bitcoin doesn't carry a danger of its supply being hyperinflated (massively devalued) through overprinting. That could be where a large impetus of bitcoin growth comes from.

All in all, Buffett is heavily invested in the stock market & the last thing he wants is for investors to pull their money out of stocks and put it into crypto instead. Buffett is in a position where politically he has no choice but to condemn bitcoin. He's always played it safe. New and emerging technologies are not his forte.

As we already know that warren buffet is not an admirer of bitcoin.He has always criticized bitcoin.He is a traditional investor and he has knowledge only about traditional companies.He has been investing in such traditional companies through out his history and he has not invested in any of the technological companies.So,he has always tried to stay away from technology related company.There is nothing surprise in hearing such a statement against bitcoin from such a person.Actually he lacks knowledge about bitcoin.So,we need not have to care about statements of such persons.

I think that Warren Buffet is missing the point ---> the big picture.  It's not the ones and zeros, the op_codes and hashes, or the combination of cryptographs which people are trading ---> it is TRUST!  The ability to engage in the markets without the interference of those third parties which Warren Buffet so dearly relies upon.  Cryptocurrencies have value because they keep those money grubbing thieves out of our business!

He is right, bitcoin is only good for speculation, when people will be tired of speculating...

Warren is very successful in his own right and he often says that he will not invest or comment on things that he does not understand. Bear in mind that some of his larger investments are in very traditional things like Railroads, Coca Cola and BANKS including Bank of America BNY Mellon etc. So he is good buds with Jamie.

Whats interesting is that BNP came out today all guns blaring against Bitcoin today as well, and still, it grows?

The jokes he said do not apply now. Bitcoin develops every day and its value continues to rise. All transactions are transparent, making Bitcoin users always clear what they are doing. Big technology with high value. "Bitcoin and Blockchain"

fiat has value. its backed by debt. which is backed by assets namely eg mortgages.

bitcoin is based on belief.

What's gong to happen if eth gets above btc. Or something else in the future?

Warren Buffet isn't a fool you know.

Well, if he didn't invest in bitcoin when it was cheap, then he's certainly missing something. Maybe he's just not a fan of capital flight!  Bitcoin is all about decentralization and distribution of control ---> it's worth way more than that dirty paper he worships!

ah yes, who controls it? Is it the Chinese or roger Verr lol

What statement do you expect from Warren Buffet, he is a known investor for more than 40 years and all of his investments and assets are based on a fiat currency. How will you expect him to embrace the use of crypto currency if it will somehow affect his existing investments and businesses.

Hmm where to start. Well technically he is not wrong so there is that but I think that is where it stops being good for him. First off the only reason he is taking a huge shot at bitcoin is because there is a lack of disconnect

there. Not saying he doesnt understand it but for some reason on some level the dude is having a hard time understanding why real money is flowing into something that does not seem real. It challenges the very nature of

what his financial world was built on and understandably he is not going to accept it as a part of his world. That is my main gripe with his statement that and the underlying negative connotation behind it.

With all respect to the man, Warren Buffet is a traditional banker. If he fails to embrace innovations like Bitcoin, his time is done. Obviously he already missed out on the opportunity to get 800% gains on bitcoin this year. Whether or not it is a joke or not it was an opportunity to make a lucrative amount of money and he missed it. Why? Because he is an arrogant old man whose success has gotten to his head.

He don't even know what's the flow of bitcoin, technology is rising he must understand that bitcoin is dominating the world, well he thinks that bitcoin is just transferring money to another user well in fact bitcoin has a value but digitalize asset that will give an impact to a modern technology

I think Warren is just trolling. Because he didn't really understand how bitcoin is being considered today. Right now many people is considering bitcoin as money. With that said, its no joke for most of us here. Bitcoin is not only an asset or commodity but is becoming a currency. So the idea that is a joke is thrown out of the window.

He is maybe just a old school investors that's why he can't really grasp what bitcoin is. See why bankers are afraid of bitcoin? Because the flow of the cash in going to the bitcoin ecosystem. Which means they are losing real cash here. Those that are really involved in fiat investing doesn't really know how crypto's work, that's why they don't like investing on it. For them fiat(money) is the best investment, however if you see bitcoin its becoming 'real cash' as well.

The fact that he's trying to compare BTC with a check in value transmission actually shows his ignorance when it comes to the technology behind cryptocurrencies. In the grand scheme of things, it's really the system behind the check that's becoming irrelevant. It's inefficient and it's costly in its own way.

Doesn't he also see that banks are starting to do R&D on distributed ledgers?

He's old but I hope he'll have enough time to think deeply about BTC and have his own aha moment.

Warren Buffet is an old timer, he believes in commodity based assets.
Debt has no intrinsic value either.
Like Fiat currency, it's backed only by legislation.
But legislation is only words on paper, ultimately backed by coercive measures and hard power.

If legislation and coercive measures made 'value', then China must have a very high valued currency.
But they do not.

No, there's something else going on here and Warren Buffet is too old or too smart to say it.

What gives Fiat it's value, is consensus.
The other world currencies pegged their own currency to the dollar, which used to be backed by gold.
Now the dollar is not.
But there is still a consensus it's worth something.

Bitcoin codifies that consensus into hard math, which is immutable.

That's sad. I respect Warren Buffet, and will continue to do so. I respect his views.

That doesn't mean I find his opinion a little misguided though. True, checks and cryptocurrencies are both ways to transmit money, but the biggest difference is you have to bring your check physically to a bank. You can do all your Bitcoin transactions at home, on the other hand. One other fundamental difference is that Bitcoin is decentralized. You yourself are sending your Bitcoins, not having banks send your money for you. It's a trustless process with your full control subject to much less, if any at all, limitations.

But eh, at least he's not disparaging on Bitcoin openly without provocation right?

the established capitalists cant befriends new that want to become capitalists, they have to find ways to surpress them,

after all the american civil war was about the central bank, slavery was later used as a scapegoat.

regards

legislation is important, it gives the people that work for money a security that their work is beeing guided towards a certain goal, hard math of bitcoin is insignificant because you are more like a sect, claimings its valuable and wasting a ton of electricity, the moment you will lose popularity your bitcoin dream will collapse, others will simply take over cryptography and create national cryptocurrencies powered by legislation

regards

If legislation was important, then why does Argentina have so many problems?
Legislation cuts both ways, it can insure your money in the bank. But such legislation was quickly deleted when the government decided it wasn't in their interests.
Argentina, Cyrpress, Greece - the governments used legislation to freeze bank deposits, restricted access to money and then imposed a 'haircut' (raid on people's savings).
Legislation has no intrinsic value.
It's only value is in coercive measures, and that sucks.

These old people are going to say whatever they can to try and hold onto whatever wealth they have left. Or maybe he just is a complete idiot and doesn't understand the value of BTC. This is huge because he made a lot of money, but from centralized systems so he is an expert on greed. People who don't know compassion and cooperation, don't get Bitcoin that's just what it comes down to.

Gold is irreplaceable: Almost half of the gold sold is used in electronics and medicine. It's not just about jewels.

Gold is unique: it has unique properties.

Gold is scarce. You could fit all the gold in the world on a tennis field.

Bitcoin might be considered scarce as well, but I fail to see how it's irreplaceable: you can fork it, community can decide it's not worth a penny anymore and shift their (financial and technological) resources elsewhere. Bitcoin to fiat exchanges could be banned anyday, who's gonna give a fuck about Bitcoin anymore if not the few anarchists and libertarians left here?

Anyway I find it hilarious how a bunch of no ones criticizes so lightly the most intelligent and successful the world has ever seen.

If Warren Buffet tells you something, you should probably rethink 100 times why you disagree with him rather than pushing this "he's old, he doesn't understand".

Like it or not, Bitcoin has no intrinsic value, if it has one, it's no different than any other coin out there, including the worst shit coins with a 20$ market cap.

Bitcoin has a price.

Buffett also never invested in Facebook or Twitter.

Fool.com (https://www.fool.com/investing/general/2014/07/16/why-warren-buffett-will-never-buy-facebook-or-twit.aspx) wrote this in 2014:
From his perspective, he is of course right! He does what he does best, and it made him one of the richest men on the planet.
Especially the bold part is true: While early investors in Bitcoin or Facebook made massive profits, at the same time many high-risk venture capital investments turned to dust. In hindsight it's easy to pick winners, when I first saw Bitcoin I never expected it to grow this much. I wish I did!

it is evident that no one can predict the future, especially bitcoin, even rich people like warren buffets who have extraordinary experience in the field of business also experienced a big mistake in predicting bitcoin, and consider it only joke

Gold is not irreplaceable it's price has no correlation to it's industrial nor decorative uses.
The scarcity is only a temporary condition.
Probably in 100 years we'll start mining asteroids and then gold will no longer be so scarce.

Mr. Buffet is a successful investor, but he lives in Paper Money era and Cryptocurrency is the future. And as for future, Bitcoin will be the king among other cryptocurrencies. Also, everything Mr. Buffet says is not single meaning words, Example, when he bought a huge stock of Coca-Cola, in a next interview he just mentioned that he takes his major calory from coke - see, how wisely he advertises what he values in simple interviews?.

Mr. Buffet will invest in Blockchain and Cryptocurrencies just like Mark Cuban or Jamie Dimon of JPMorgan. Also, there could be some reason that Mr. Buffet is thinking of his very own Crypto (maybe buffet coin, hahaha) and he is just making it's way easy against Bitcoin.

http://commodityhq.com/education/top-seven-warren-buffett-quotes-on-gold-investing/


Now honestly, you want to educate a 87 yo man to be prepared for a technology he is going to enjoy...a few years at max?


Yeah , mainly because he has spent almost a century living in this era?
I really doubt it. He has a way of investing only in things he understands how they work.
Probably it's too late for him

I wouldn't say that Berkshire Hathaway's investments are based on "fiat currency".... Buffet is a value investor, not a technology visionary. He's not a Silicon Valley tech guy. He has always invested heavily in reliable blue chip and infrastructure sectors. He likes traditional industries that he can wrap his head around and analyze the growth/revenue fundamentals.

Berkshire wasn't invested in many of the top growing technology companies, and Buffett has actually said that he'll never invest in Facebook or Twitter, regardless of how they perform.

He doesn't invest in things he doesn't understand. I can respect that. Fortunately, we as early adopters can prove him wrong about Bitcoin on the open market.....

...which is something I wished more people in crypto would do.

Of course the market would be a whole lot more boring, but at least pump-and-dumps, buzzword speculation and a lot of other questionable "investments" would fall on far less fertile grounds. Then again I guess that's what makes crypto so fun in the first place.

Old habits die hard. Warren has been using paper money for so long that he can't understand that an independent, decentralized economy can exist. To him it's just all that hippie ramble. It's a normal thing. Try to talk to any 80 year old person about cryptocurrency, programming, and they won't understand it. You really need an open mind to learn and accept things like that and most 80 and 90 year olds are close minded. They live in the past.

Will this effect the market for some time because like last time when Jamie Dimon said about btc the market has fallen sharply and now its Warren Buffet. When such highly intellectual people speak it might effect the market though it may be temporary and then rise back again like it had happened last time with JPM CEO case.

I wrote an article about value of cryptocurrencies if anybody's interested.

https://medium.com/@enricopolanski_16624/understanding-the-value-and-price-of-bitcoin-and-other-cryptocurrencies-5166cfdf9533

Any way that is just his own opinion about bitcoin and his his judgement is base on his lack of adequate knowledge about bitcoin. I guest he share the same view about gold also if not so buffet has miss it altogether.

This is only his opinion of whoever he was. He may not already understand that the world is changing and we either go with him or stay where we were.