Bill Gates has described the phenomenon of NFTs and cryptocurrencies as “100% based on the biggest fool theory”.
Bill Gates, the billionaire businessman, founder of Microsoft, said that NFTs and cryptocurrencies are based on a system known as the weakest principle. This statement was made in the context of the crypto winter and the massive decline in the popularity of NFTs.
Gates recently participated in a TechCrunch talk on climate change. The billionaire Microsoft co-founder described the NFT and cryptocurrency phenomenon as “100% based on the theory of the biggest fool”.
The idea is that higher-value assets will increase in price when there are enough willing investors to pay more for them.
Bill Gates and the Digital Monkey
Gates sarcastically stated that “expensive digital images of monkeys” would certainly “make the world a lot better.” This was, of course, a reference to the famous NFT collection of Bored Ape Yacht Club. The billionaire also referred to the cryptocurrency market, saying that he is “not involved in any of these.”
Gates emphasized that he would prefer to invest in assets with tangible results, such as farms, factories, or the manufacture of products.
stupid theory
What is the “stupid theory” that Bill Gates talks about?
The dumbest theory holds that financial bubbles arise from the dogmatically optimistic behavior of market participants (called the most stupid). They buy assets of higher value in anticipation of their sale to speculators.
Gates applies this phenomenon to the case of NFTs, which according to him lack intrinsic value. Gates applies this to cryptocurrencies as well, which always have greedy buyers even when assets are high. It does nothing more than create a structure in which the first sucker tries to sell the worthless asset purchased to avoid loss.
This process repeats itself almost like a loop, until the system collapses. The last layer of fools (the idiots) are totally impressed. This scheme shows many similarities with Ponzi schemes. The stock market, property market and other assets have also been accused of being a Ponzi-like scheme.
NFT and crypto winter fall
The statements of Bill Gates are in no way different from the current context. Both NFTs and cryptocurrencies are failing to recover from their all-time highs.
The iconic and popular Bored Ape Yacht Club (BAYC) non-fungible token (NFT) is down 78% since April. At that time, they were worth around $429,000. The price has now dropped to around $80,000. And the craze of BAYC on Google Trends has also come down drastically.
With respect to cryptocurrencies, the crypto winter is well and truly set. Bitcoin (BTC) and Ethereum (ETH) are going through a series of declines.
In this situation, many claim that the best strategy is to buy more cryptocurrencies in the hope of increasing their value in the future. From Bill Gates’ point of view, it would absolutely be a trap for the crypto market.
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