A letter from Legendary VC Fred Wilson to Buffet: The Value of Bitcoin Lies in the Agreement Itself
Legendary Fred Wilson made a public response to Warren Buffet’s point of view that Bitcoin is the “rat poison” and is completely wrong. The investment tycoon from the United States said that Buffett did not conduct in-depth studies.
Why Bitcoin is valuable
In a speech at the consensus conference, Wilson said that the core value of the Bitcoin ecosystem lies in the agreement itself, not the business built on this system. He said that Buffet did not take the time to really understand the current situation, and his company, Union Square Ventures, will be able to do even if it is involved in a speculative investment.
Wilson has invested in web 2.0 companies including Twitter, Tumblr, and Kickstarter. He acknowledges that the value of some of the current tokens has indeed been over-extended. He went on to say that this would not be a reasonable purchase in the short term.
An open letter to Warren Buffett
Earlier this month, billionaire Buffett called Bitcoin as a “rat drug” when he spoke at a general meeting of shareholders, saying Bitcoin did not generate any value. Wilson responded to this.
Buffett’s commentary received overwhelming criticism, mostly from blockchain entrepreneurs, but some well-known entrepreneurs such as Wilson expressed dissatisfaction. However, there are some who support Buffett’s point of view, such as Bill Gates and most large banks.
After the consensus conference was over, Wilson published an open letter on his blog, repeating what he mentioned at the meeting. He said that Buffett did not like Bitcoin because the underlying network lacked cash flow. He hinted that Buffett’s investment style is focused on business investment, and Bitcoin is decentralized, and there is no business activity Buffett can invest in. Wilson believes that this is why Buffett is not optimistic about Bitcoin.
Wilson’s comments are still very cautious. He said that he hopes that the government will realize the rationalization of this market and will eventually supervise it. As for the ICO market, he thinks there is still some way to go before it becomes a new capital market.