Bill Gates dismisses NFTs as “based on greater fool theory”
The Microsoft founder sowed doubt regarding the future and social value of the digital asset class of the moment.
Famed Microsoft founder Bill Gates has dismissed NFTs, claiming the digital asset class is “100 percent based on greater fool theory”.
The greater fool theory suggests that you can often make money by purchasing overvalued assets, as those assets can later be resold at a greater price if there is a “greater fool” available.
If no “fool” is available, these assets will eventually tank in value according to the theory.
Gates said he would rather invest in physical assets like farms and factories, or in “a company where they make products”, he told an audience at a physical event hosted by TechCrunch.
Gates objected to the lack of social value offered by NFTs, in an obvious dig at bestselling NFT collection Bored Ape: “Obviously, expensive digital images of monkeys are going to improve the world immensely”.
The billionaire confirmed “he’s neither long nor short” cryptocurrencies.
Gates has an established history of skepticism when it comes to the crypto space.
"The value of crypto is just what some other person decides someone else will pay for it, so not adding to society like other investments," Gates said in a May question and answer session on discussion forum Reddit.
Gates is not the only one among the world’s richest people to express sentiments around the lack of social value offered by cryptocurrencies like Bitcoin in recent months.
“Whether it goes up or down in the next year, or five or 10 years, I don’t know,” said billionaire Warren Buffet at the most recent Berkshire Hathaway shareholder meeting. “But the one thing I’m pretty sure of is that it doesn’t produce anything.”
Many other investors could be having second thoughts regarding the true value of NFTs.
The lowest price for a Bored Ape Yacht Club NFT fell below $100,000 for the first time since August 2021, representing a fall of 78 per cent% since late April.