Winklevosses: Bitcoin worth at least 100 times more - CNBC

[AndrewWilliams]

Winklevosses: Bitcoin worth at least 100 times more
Published: Tuesday, 12 Nov 2013 | 11:52 AM ET
By: Matthew J. Belvedere   | Producer, CNBC's "Squawk Box"


 The Winklevoss twins are screaming bulls on bitcoin.

Cameron and Tyler Winklevoss—big investors in the digital currency—said Tuesday that bitcoin should be worth at least 100 times more than it's valued today.

"The small bull case scenario is a $400 billion market cap. So the market cap is around $4 billion right now," Tyler Winklevoss said in an interview at the DealBook conference that aired on CNBC's "Squawk Box."

The twins, who famously battled Mark Zuckerberg over the origins of Facebook, started buying bitcoin at $9. Their investment was worth $11 million in April at $120 per coin.

After a sharp drop, bitcoin has surged into record territory again, hitting $385 in early Tuesday trading on Mt. Gox—one of the many exchanges for the digital currency.

Cameron Winklevoss said he views their investment in bitcoin as a gold 2.0-play but also a bet on the technology: "The idea that payments are increasingly going to use a network like the bitcoin network to move money around the world."
Adam Jeffery | CNBC
Tyler and Cameron Winklevoss

The Winklevosses want to create a bitcoin exchange traded fund (ETF), accessible to all investors. "We filed an amended S-1 in October. And we're just still going through the process," Cameron said.

He explained how bitcoin works: "Miners mint bitcoins every 10 minutes. It's basically a computer algorithm." He said the computers built to mine are so specific "you couldn't really do it as a hobbyist."

Bitcoin was created by Satoshi Nakamoto, a pseudonym, Tyler said. "We don't need to know him because it's based on ... trust in cryptography, not trust in individual."

As for what regulators in Washington think about bitcoin, Cameron said, "I think everyone recognizes the innovation and doesn't want to stifle it. They just want to make sure there's healthy regulations so it's used in a safe and productive manner."

Last month, bitcoin plunged after U.S. authorities shut down the Silk Road site, an accused online purveyor of drugs and other illegal services. Bitcoin had been hit by the perception that it was used primarily for transactions on Silk Road, and many had expected demand to dry up after the website was closed.

But Tyler Winklevoss said those concerns were never realized: "Prices are double what it was before Silk Road was shut down. So the demand to use bitcoin for illicit activity was clearly almost zero."

Mainstream merchants are slowly adopting bitcoin. Cameron pointed out that e-commerce platform Shopify announced it will accept bitcoin, and so has China portal Baidu.

The digital currency has even made steps into the physical realm, with ATM manufacturer Robocoin launching the first bitcoin ATM in a Vancouver coffee shop.

—By CNBC's Matthew J. Belvedere. Follow him on Twitter @Matt_SquawkCNBC.


BTC


http://www.cnbc.com/id/101190181

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[lindatess]

Two Words:

Vested Interest.

It's like how Max Keiser all of a sudden started to hype litecoin after being on bitcoin.

I wouldn't be surprised if he caused a movement of funds towards litecoin and away from bitcoin.

Don't trust anyone. Furthermore, Winklevoss wants to create an ETF which allows others to short bitcoin.

You do realise the problems we have already with the shorting of GOLD via ETFs? There would also be a futures market created which could lead to the problems we have seen with gold being settled in cash rather than physical delivery of gold because they shorted gold but cannot deliver it.

The same thing will happen, we can't let them do this if we want bitcoin at a high value.

This is a dud article, and is actually value destructive. If the Winklevosses are smart, they won't call for an ETF or futures market.

Then again they did sell out to Zuckerberg, that wasn't very smart of them.

[maurya78]

Talking our own book again, are we>

[beetcoin]

Two Words:

Vested Interest.

It's like how Max Keiser all of a sudden started to hype litecoin after being on bitcoin.

I wouldn't be surprised if he caused a movement of funds towards litecoin and away from bitcoin.

Don't trust anyone. Furthermore, Winklevoss wants to create an ETF which allows others to short bitcoin.

You do realise the problems we have already with the shorting of GOLD via ETFs? There would also be a futures market created which could lead to the problems we have seen with gold being settled in cash rather than physical delivery of gold because they shorted gold but cannot deliver it.

The same thing will happen, we can't let them do this if we want bitcoin at a high value.

This is a dud article, and is actually value destructive. If the Winklevosses are smart, they won't call for an ETF or futures market.

Then again they did sell out to Zuckerberg, that wasn't very smart of them.

word.. i brought up max keiser on reddit, and it seemed like most people were blind fans of his. i might get some flack for this, but when i look at his face i just think "rat."

[zeetubes]

An ETF is a great tool for most investors, but this is a slightly different case in that if investors want to invest in a given currency, they typically just go ahead and buy some. In gold and silver, the ETFs are convenient for people who don't want the hassle of storing physical. When a better wallet is created, for bitcoins, "physical" storage of coins won't be an issue. In this case, the appeal of a bitcoin ETF will also be for people who want to invest their solo 401ks and similar instruments. Sadly, there will also be players who want to use an ETF to naked short. Not much can be done to avoid that. I'm not sure if the existing and proposed BTC ETFs actually require purchase of coins (like in those gold ETfs that list the serial numbers of bullion they own).

[bryant.coleman]

At 1 BTC = $618, the market cap is $ 7.4 billion.

If the market cap increases to $400 billion, then each BTC will be worth $33,405.