Tags: peter thiel | bitcoin | potential | cryptocurrency

Billionaire Peter Thiel: Don't Underestimate 'Great Potential' of Bitcoin

Entrepreneur Peter Thiel (Photo by Alex Wong/Getty Images)

By    |   Thursday, 26 October 2017 02:34 PM

Billionaire Peter Thiel said people are "underestimating" bitcoin and it has "great potential left"

"While I’m skeptical of most of them, I do think people are a little bit maybe underestimating bitcoin specifically because it’s like a reserve form of money. It’s like gold. And it just a story of value, you don’t actually need to use it to make payments, and there’s about $70 billion worth of bitcoin in the world," the PayPal founder told Fox Business Network.

"There’s 9 trillion worth of gold. And if Bitcoin ends up being the cyber equivalent of gold, it has a great potential left. And it’s a very different kind of thing, people in Silicon Valley normally focus on companies, not algorithms or protocols, but this may be one exception that’s very underestimated,” told Fox Business Network.

Bitcoin is commonly defined as a worldwide cryptocurrency and digital payment system[8]:3 called the first decentralized digital currency, as the system works without a central repository or single administrator.

Thiel also discussed bitcoin being compared to gold.

“Well, the argument, [bitcoin] is based on the security of the math, which tells you that it can never be -- it can never be diluted by government. It can never be -- it can't be hacked. And it's a form of money that is absolutely secure in an absolute way. And you could ask the same question about gold. That's why I used gold analogy, you could say what is gold based on, why is gold about valuable. It's a tangible asset but it's also hard to mine. So if it was easy to mine gold then it wouldn't be that valuable. So you would just have way more gold. So bitcoin is also it's mineable like gold. It's hard to mine, it's actually harder to mine than gold. And so in that sense, it is more constrained and so, yes, there are a number of things that -- that I think make it somewhat similar to gold.”

However, other respected economic minds aren't sold on bitcoin.

Billionaire Saudi Prince Alwaleed bin Talal, who owns investment firm Kingdom Holding, expressed skepticism about cryptocurrencies in an interview with CNBC on Monday, warning that bitcoin was like “Enron in the making”.

Prince Alwaleed, whose company invests in major U.S. companies such as Citigroup and Twitter, said a lack of regulation made such cryptocurrencies risky, Reuters reported.

“I just don’t believe in this bitcoin thing. I think it’s going to implode one day. It’s Enron in the making,” he said, referring to the U.S. energy company that filed for bankruptcy in 2001 after revelations of a widespread accounting fraud.

“This thing does not make sense. It’s unregulated. It’s not under the control of the U.S. Federal Reserve or any other central bank,” he added.

Bitcoin is a virtual currency that has gained more than 500 percent this year, more than any other tradable asset class.

(Newsmax wire services contributed to this report).

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Billionaire Peter Thiel said people are "underestimating" bitcoin and it has "great potential left"
peter thiel, bitcoin, potential, cryptocurrency
Thursday, 26 October 2017 02:34 PM
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