Chamath Palihapitiya, chairman of Virgin Galactic and founder of investment firm Social Capital, explained to CNBC’s “Squawk Box” crew why he says bitcoin is a “fantastic hedge.”
Billionaire investor Chamath Palihapitiya disagrees with Berkshire Hathaway chairman Warren Buffett on the value of bitcoin, as Buffett declared earlier this week that cryptocurrencies have “no value.”
“He is completely wrong and outdated on this point of view,” Palihapitiya said on CNBC’s “Squawk Box” on Wednesday.
Buffett thinks that cryptocurrencies “don’t produce anything” and have zero value, declaring that he never will own anything like bitcoin. He’s long been a critic of bitcoin and has described the digital currency as “rat poison squared,” a “mirage,” and “not a currency.”
Although Palihapitiya disagrees with Buffett on the potential for cyrptocurrencies, the Silicon Valley investor said he still greatly respects Buffett on the whole.
“I think he’s an exceptional person. I’ve learned an enormous amount, both from afar and the few interactions I’ve had with him,” Palihapitiya said.
Palihapitiya has long been a supporter of the digital coin, saying “everybody should have 1% of their assets in bitcoin specifically.”
“I don’t think when you wake up and see a coronavirus scare and the Dow down 2,000, you should not be going in and buying bitcoin. That is an idiotic strategy,” Palihapitiya said. “I think a reasonable strategy is to say 1% of my net worth should be in something completely uncorrelated to the world and how the world works. You quietly over some period of time accumulate a position and then just never look at it again and hope that that insurance under the mattress never has to come due. But, if it does, it will protect you.”
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