Buffett, Munger, Gates Continue to Get Their Due for Dissing Bitcoin; Now From a VC

A popular VC has weighed in on the benefits of Bitcoin, as the parade of people criticizing Warren Buffett, Charles Munger and Bill Gates grows.

Famous in his own rights, Chamath Palihapitiya made headlines Wednesday with his critical comments against Warren Buffett, Charles Munger, and Bill Gates over the comments the trio made about Bitcoin.

While Palihapitiya’s comments challenged those made by the trio, he also raised some interesting points about how Bitcoin can be used as a hedge instead of gold.

Let’s start with what Palihapitiya said about Bitcoin being used as a hedge.

Bitcoin as hedge against another 2008?

We all remember the financial devastation from the 2008 housing collapse. Palihapitiya said we should never forget it, considering “everything broke and the things that we thought were hedges went away.”

For him and others who’ve been holding Bitcoin since 2012, the crypto is viewed as a hedge to the traditional financial infrastructure.

“The reality is, all of these financial assets in traditional markets are fundamentally correlated. So in 2018 or 2019, if we go through another cataclysmic financial event financial event like in 2007, we’re going to see same fund correlation.”

He went on say it makes sense to have an asset in your portfolio that was a non-related hedge because this is about buying insurance.

Gold has traditionally been the go-to asset as a hedge. That may not appeal to the generation that’s buying cryptos. Palihapitiya said:

“Younger people want to buy something more digital. They probably don’t want to buy gold.”

Let’s move on to the trio.

Scum ball activity

The trio earlier this week made disparaging comments about Bitcoin that made JP Morgan’s Jamie Dimon’s seem soft. 

Munger said it was “scum-ball activity.”

Buffett said “it will end badly.”

Gates said he would “short it if it was an easy way to do it.”

The inflammatory comments were immediately criticized by a host of Bitcoin observers. For his part, Palihapitiya pointed out that Buffett is not a fan of investing in technology, so it shouldn’t be a surprise that he wouldn’t embrace Bitcoin.

On that same note, he hinted at maybe the trio should stay in their lanes, adding they’re good at what they do.

“I’m a disciple of Buffett and Munger. I think it’s really unfair to not understand something and then disparage it. They’re good at what they do. The reality is things change.”

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