Bitcoin: Better than gold or, as Nouriel Roubini argues, worthless?

Bitcoin has been rewarding its supporters. And, previous sceptics are entering the arena as the cryptocurrency enters the mainstream. Should you get in now? A blockchain company boss says ‘yes’; a world expert on asset bubbles, says ‘no’ – it doesn’t even qualify as an asset. – Jackie Cameron

Antoni Trenchev on Bitcoin:

It is the best performing asset on any significant timeline. Whether it’s one year, five years or 10 years – it is the best performing asset. So it is a matter of having the right perspective when investing in Bitcoin. That’s how we build out our business, very conservatively. We lend only a loan to value ratio of 50%, precisely because of its volatility. We structure the business that thrives in gold, bull and bear markets.

Antoni Trenchev on whether Bitcoin will be treated in the same way as gold:

I think that actually Bitcoin is a better version of gold, because it has the necessary characteristics –  scarcity, a fixed finite amount. With Elon Musk taking us to Mars, apparently, there is a bunch of gold there. So we might see some inflationary pressures on gold. I do think that Bitcoin is actually a better version, because next time you travel to Europe, try bringing a U$1 million in gold versus the same amount in Bitcoin. It’s much better in so many ways. I think we’re going to see outflows from gold into crypto. It is a totally new asset class, like something we’ve never seen before. It’s here to stay.

Antoni Trenchev on Bitcoin vs gold:

If you invested U$1 in gold a year ago, you would have about a U$1,70. If you invested that U$1 in Bitcoin 10 years ago, you have around U$25 million right now.

Antoni Trenchev on the use of cryptocurrency:

First of all, the number one choice for money launderers in criminal syndicates is the dollar. There’s no beating around the bush with that fact. More importantly, we need crypto – and in particular Bitcoin – (because there are 3,000 other cryptocurrencies, which we’re not super excited about). But what sets Bitcoin apart is the fact that precisely your central bank cannot print it at will.

This is something that we’ve seen being done on a massive scale last year. I think close to a trillion dollars have been printed and you can feel the creeping inflation. It’s palpable everywhere. I was in London some time ago and I paid for the exact same meal that I paid as a student 10 years ago – twice the pound value. So it’s obvious inflationary macro-pump money printing environment, that people will be searching for alternatives. Bitcoin is our generation’s gold. It’s obvious that we millennials – the next generation to be the main driver of the economic cycle – are taking such an interest in Bitcoin in particular.

Nouriel Roubini on Bitcoin:

It doesn’t have any income. It doesn’t have any use. It doesn’t have any utility. So it’s a pure, speculative, self-fulfilling bubble on price appreciation. It’s like tulip mania. But in the case of tulip mania, tulips had some utility. Even today, people love flowers. In this case, you have an asset that is not an asset because it doesn’t have any feature of an asset – it doesn’t have any feature on the currency. So it’s just a self-fulfilling bubble.

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