SAN FRANCISCO (BLOOMBERG) - Billionaire Bill Gates dismissed cryptocurrency projects such as nonfungible tokens (NFTs) as shams "based on the greater fool theory" at a climate conference on Tuesday (June 14), reviving past criticisms of digital assets.
The greater fool theory argues that prices go up because people are able to sell an overpriced item to a "greater fool", whether or not it is overvalued. That is, of course, until there are no greater fools left.
"Obviously, expensive digital images of monkeys are going to improve the world immensely," Mr Gates said sarcastically while speaking at an event in Berkeley, California, hosted by TechCrunch. He said he is neither long nor short the asset class.
Mr Gates has criticised crypto before, sparring with Tesla's Elon Musk last year over whether Bitcoin is too risky for retail investors and the environmental harm of mining coins. Speaking on Tuesday as the founder of Breakthrough Energy Ventures, the climate-focused fund he began in 2015, Mr Gates noted the difficulty of recruiting Silicon Valley engineers to work in industries like chemicals and steel production in need of lower greenhouse gas emissions.
Bitcoin plunged more than 15 per cent on Monday and another 5.4 per cent on Tuesday, part of a broader crypto sell-off fueled by higher than forecast US inflation and the halt of withdrawals by the lending platform Celsius. Popular NFT collections, including the celebrity-favoured Bored Ape Yacht Club, are also being hit hard.
Mr Gates also defended digital banking efforts he has supported through his philanthropic foundations, which he described as "hundreds of times more efficient" than cryptocurrencies.