Image Credit: Whatsupwhodis via Twitter
If I had a dollar for every Bitcoin critic, I’d be richer than Bezos.
Even Elon Musk, love him or hate him, said “In retrospect, it was inevitable.” Bitcoin was always going to have a place in the world of money because the alternatives can be created out of thin air and there’s no limit.
Still, critics of Bitcoin made pennies dissing the digital store of value. I had comment bombs hurled in my direction. It did nothing to me. Once you read the factual research and go down the rabbit hole, there is no way you come out the other side and go “Yeah, you know what, I’m going to store all of my money in U.S. dollars in a bank account that pays me zero interest.”
But things have rapidly changed. Bitcoin critics are becoming advocates.
Jamie Dimon (CEO of JP Morgan)
2017: “It’s worse [Bitcoin] than tulip bulbs. It won’t end well. Someone is going to get killed.”
2020: “The blockchain itself will be critical to letting people move money around the world cheaper. We will always support blockchain technology.”
Also in 2020: “It doesn’t mean you can’t buy yourself Bitcoin — there are a lot of ***very smart people*** who think that that $200 billion will appreciate more than gold, and the U.S. dollar and U.S. treasuries.”
Goldman Sachs (The Investment Bank)
2020: “Cryptocurrencies including Bitcoin are not an asset class.”
2021: *Complete silence*
Then … the Nasdaq quietly states “Goldman Sachs files for an ETF (Index Fund) capable of investing in Bitcoin.”
Ray Dalio (Founder of the World’s Largest Hedge Fund)
2017: “It’s not an effective storehold of wealth because it has volatility to it, unlike gold. Bitcoin is a highly speculative market. Bitcoin is a bubble.”
2021: “I believe Bitcoin is one hell of an invention. To have invented a new type of money via a system that is programmed into a computer and that has worked for around 10 years and is rapidly gaining popularity as both a type of money and a storehold of wealth is an amazing accomplishment.”
It seems to me that Bitcoin has succeeded in crossing the line from being a highly speculative idea that could well not be around in short order to probably being around and probably having some value in the future.
George Soros (Billionaire who broke The Bank of England)
2018: “Cryptocurrency is a misnomer and is a typical bubble, which is always based on some kind of misunderstanding.”
2021: Silence from George.
Later in 2021: “George Soros set to trade cryptocurrencies — Bloomberg,” published by Reuters.
Soros’ Fund Management CIO Dawn Fitzpatrick says:
“We think the whole infrastructure around crypto is really interesting, and we’ve been making some investments into that infrastructure — and we think that is at an inflection point.”
“I think when it comes to crypto generally, we’re at a really important moment in time, in that, something like Bitcoin might have stayed a fringe asset, but for the fact that, over the last 12 months, we’ve increased money supply in the U.S. by 25%.”
Watch what the billionaires do as well as say. George knows the finance world better than most. He can now see what Elon sees: Bitcoin is inevitable.
Dave Portnoy (Investing Influencer — 2.4M Twitter Followers)
2020: “Just one big Ponzi scheme.”
Feb 2021: “I know I’m an idiot with Bitcoin.”
March 2021: “Bitcoin is the only thing that doesn’t go down. Bitcoin’s at $51,000. It was $11,000 in August. Jesus Christ.”
Jim Cramer (Host of Mad Money on CNBC)
2017: “What’s the difference between Bitcoin and trying to figure out the Super Bowl? I mean it’s gambling.”
Also in 2017: “It’s kind of like Monopoly money.”
2021: “It’s almost irresponsible not to include Bitcoin on balance sheets following Tesla’s buy.”
Also in 2021: “It’s an alternative to a cash position where you make absolutely nothing.”
Again in 2021: “Bitcoin is exciting.”
More in 2021: “But gold let me down. Now I say five percent of gold, five percent of Bitcoin.”
There Are Two Big-Name Bitcoin Critics Left
Warren Buff Abs still hates Bitcoin. He thinks it’s rat poison. You have to take his opinion in the context of what he knows. He openly admits he doesn’t know technology. He bought Apple stocks in 2016 very late in the journey.
Then there’s gold expert Peter Schiff. He hates Bitcoin but that has more to do with his love of gold than his knowledge of what bitcoin is and the problem it solves. Ironically, Schiff’s son has gone all in on Bitcoin and is at war with his dad on Twitter over it. Of course, his son is making him look stupid.
Schiff’s kid has a solid argument against his dad:
[Dear dad] Your understanding of money is flawed. You think the key determinant of a money’s soundness is possession of ‘intrinsic value’, a nonsensical concept.
What differentiates sound money from fiat [government] money is the former’s emergence on the free market rather than by coercive State edicts.
Peter is thinking in terms of using postal services to physically mail letters. His son is thinking in terms of the internet, networks, smartphones, apps, social media, decentralization, Web 3.0, and a change in ownership structure.
Why Are Bitcoin Critics Becoming Advocates?
- Simple. Money talks. All you have to do is look at the year-on-year gains and the results of the network effect (Metcalfe’s Law).
- It’s only until you have an investment problem that you start to understand Bitcoin. See, when you have to find places to invest money, you start to see the existing options have problems.
Cash can be created out of thin air and earns zero interest.
Stock prices are inflated because of all the free money floating around in the financial system. The market fundamentals when measured in something other than dollars suggest the stock market isn’t doing so well.
Gold is heavy, hard to store, slow, mostly owned by boomers, and has had terrible performance when it’s been needed more than ever.
Real estate is expensive to get into. You have to take on debt [stress] to buy it and know what the heck you’re doing. It’s easy to go wrong.
Bonds are governments and corporations’ dirty laundry. They can’t wait to throw their debt at investors and pay them peanuts in return. You’re taking all the risk and you’re lucky to even break even against annual inflation.
The financial world has become advocates of Bitcoin because it’s a logical way to invest and protect the value of money. You trust code to protect the value, not people or governments.
Bottom line: Critics have helped the value of Bitcoin increase. When critics are wrong about Bitcoin and you own it, you do well.
Critics are backflipping on Bitcoin at record pace because the solution to an age-old problem is now, right in front of their eyes. A financial education sets your mind free and protects the value you create.
Refusing to understand Bitcoin is financially unplugging yourself from the internet.
This article is for informational purposes only, it should not be considered Financial or Legal Advice. Consult a financial professional before making any major financial decisions.