There is no shortage of believers in Bitcoin and its underlying blockchain technology, but when it comes to investing in the cryptocurrency, billionaires Warren Buffett and Bill Gates both think it's a bad idea. Crazy, even.
Gates told CNBC that Bitcoin is "one of the crazier, speculative things" he's seen, and that he would "short it if there was an easy way to do it." In the investment world, shorting is when you bet against an asset and make money if its value falls.
"As an asset class, you're not producing anything and so you shouldn't expect it to go up. [Bitcoin and cryptocurrencies] are kind of a pure 'greater fool type of investment," Gates added.
Buffett also spoke negatively of Bitcoin, telling CNBC it's "probably rat poison squared" while presiding at the Bershire Hathaway 2018 annual shareholder meeting on Saturday.
Charlie Munger, Berkshire's vice chairman, echoed those comments saying that trading in cryptocurrencies is "just dementia," likening it to somebody else "trading turds and you decide you can't be left out," CNN reports.
He also predicted that things will come crashing down in the digital coin world. "In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending," Munger said.
Following the collective comments, Bitcoin's value dropped nearly 6 percent on Sunday and then another 2 percent today, to just over $9,300. It's still the most valuable cryptocurrency out there, though the dip in value further underscores the volatility of digital coins. Several others dropped in value over the past 24 hours as well, including Ethereum, which is down more than 6 percent, according to CoinMarketCap.
Bitcoin's advocates will point out that people have been laying out gloom and doom predictions for some time now, and that's true. We're more concerned with what effect it all has on GPU pricing. It's no longer feasible to 'mine' for Bitcoins using a consumer graphics card, but there are several other currencies where it is, which are sometimes traded for Bitcoin. So, it still has an impact on the cost and availability of graphics cards.
The good news is we have started to see GPU prices come down. Graphics cards are still selling for above MSRP for the most part, but it's a little easier these days to find one that isn't super inflated.