Microsoft founder Bill Gates has now warned the would-be bitcoin (BTC) buyers who want to follow Elon Musk’s investment strategy. While speaking to Bloomberg’s Emily Chang, Gates said that Elon has access to sophisticated trade management techniques that the average investor cannot use.
The Microsoft founder believes that anyone with less money than the Tesla CEO should ‘watch out’ when it comes to bitcoin. When asked about Bitcoin’s susceptibility to tumble in price in response to a simple tweet, mainly referring to Elon Musk’s social media posts, Gates said that it is likely that Musk is insulated from these market crashes:
“Elon has tons of money and he’s very sophisticated so, you know, I don’t worry that his Bitcoin would randomly go up or down.”
A little over two weeks after Tesla’s $1.5B acquisition of BTC was announced, BTC’s price lost 20% on February 23, dropping from $58,258 to $46,624. Concurrently, nearly $400 billion was wiped off the global crypto market cap.
Notably, the latest crash happened a few hours after Musk said that the prices of BTC and Ether were ‘high’. Whether that was criticism or an attempt to deflect the heat from a potential investigation into his influence on crypto prices, the whole market was butchered in the aftermath.
Gates believes that it would be a mistake for the average investor to blindly follow the mania and aura of optimism that surrounds Musk’s market moves. The Microsoft founder told the investors that are not billionaires to invest cautiously. He added:
“I do think people get drawn into these manias who may not have as much money to spare. So I’m not bullish on Bitcoin, and my general thought would be: if you have less money than Elon, you should probably watch out.”
Bill Gates raised the point of BTC’s energy consumption, saying that the crypto did not return much in the way of output:
“There are things we invest in the society which produce output. Bitcoin happens to use a lot of energy. It happens to promote anonymous transactions — they’re not reversible transactions.”
Crypto Is Not Bad
Based on Gates, virtual currencies are not generally a bad thing, he just believes that they should be reversible, transparent, and centralized. He then highlighted some of the work done using digital currencies since the pandemic struck. Gates acknowledged that the Gates Foundation had even used the nascent technology to enable various governments to distribute relief funds to their citizens.