The world’s richest man, Bill Gates, has recently expressed his opinion on non-fungible tokens (NFTs). It’s no secret that Bill Gates has a lot of opinions about the future of digital assets. He has criticized crypto before, saying it’s “not a store of value.”
Now Gates is calling NFTs shams. In his latest statement, he believes that NFTs are a “greater fool theory” investment. That’s a fancy way of saying that people who spend a fortune on pictures of apes will eventually be outbid by someone else. Additionally, they may not even be able to get their money back.
Gates went on to say that he could see how people could lose money in this market, especially when it comes to speculating on digital art. He also said that he doesn’t think there’s any inherent value in digital art, but rather it’s all about what someone is willing to pay for it at any given moment. As a result, he thinks people should be careful with their money when investing in NFTs. The billionaire investor also spoke about his investment strategy, saying he doesn’t get involved in most technologies until they are “proven out.”
Earlier, Gates came out and criticized the use of cryptocurrencies for money laundering and terrorist financing. He believes that people who use crypto are only doing so because they want to get rich quickly and don’t understand the technology.
At the moment, the anti-NFT crowd is happy to have Bill Gates on board as they believe it will help legitimize their cause.
NFT floor prices plummet
NFTs are digital assets that can be traded and sold on the blockchain. Gates joked that people who spend a fortune on pictures of apes would be able to make the world a much better place by giving those resources back to society. The NFT bubble has predictably burst after the recent market correction, sending prices down sharply over the past few days. However, some NFT owners are still bullish on their investments despite this drop in value.
According to analysts, the Bitcoin Price Index (BPI), which tracks the value of bitcoin relative to other cryptos, fiat currencies, and NFT prices, have been falling steadily since reaching its peak in May 2019. The floor price for a Bored Ape Yacht Club recently plunged to the lowest level since last August, which was when its price peaked at $133 million.
In the past few years, NFTs have generated significant excitement because proponents say they solve tricky problems. But, unfortunately, the hype around NFTs has cooled significantly since the hype started about three years ago—and for a good reason: They’ve been plagued by bad actors who have targeted the industry with scams and hacks.
Axie Infinity had to shut down its operations in March after North Korean hackers stole more than $600 million worth of NFTs. The attack came just days after Bored Ape Yacht Club reported that hackers cracked into their Instagram account and stole $2.8 million worth of NFTs from them.
Several high-profile hiccups have also deflated investors’ enthusiasm for NFTs. In late April, Yuga Labs, the company behind Bored Ape Yacht Club, auctioned off millions in tokens offering land in a metaverse project they started.
While Mr. Gates’s comments have not been taken well by crypto enthusiasts, this could be helpful to many blind investors. With prices dropping and many investors losing faith in cryptocurrencies, Mr. Gates’s comments may serve as a wake-up call for those who have been investing without fully understanding how these systems work.