Anthony Pompliano has just put in an appearance on CNBC’s Squawk Box where he was taken to task on all this “crypto crap” as the CNBC anchor described bitcoin and its peers.
CNBC’s Kevin O’Leary tells his audience how he had put $100 dollars into a thing called Coinbase , at the behest of some young people at Harvard.
“I bought all the crypto crap, it’s now worth $30. That’s a 70% loss on my crypto crap. I think that really sucks.
“Everything that’s new seems different,” said Pompliano, which to be honest is a bit of a truism.
Belief in Bitcoin’s value
His main argument for crypto according to Pompliano (known affectionately in crypto circles as “the Pomp”) was that money has value because people believe it has value.
“So with the US dollar the only reason you and I use it is because we believe it has value,” Pompliano explained.
“I give you a dollar , you give me a good or service in exchange. We believe that it has value. Money is a belief system.”
The Pomp forgets to mention crypto network value
Actually money is a bit more than a belief system. It has to be rooted in something of use value to humanity. Bitcoin has value because of the network that mines it and maintain the network’s security by preventing double spending.”
Sure, once that confidence is established, then assets such as bitcoin are “believed in” by consumers and investors, bu they need to establish themselves first.
Anyway, the Pomp continues: “Bitcoin has value because two people who exchange it believe it has value.”
With statements like that he is inviting a dismissive tweet from the arch crypto critic Nouriel Roubini.
Nevertheless, as a description of where we are today Pompliano makes some headway.
“The volume, look at people using it. Bitcoin is the king and is going to stay the king.”
Bitcoin trading volume has indeed mushroomed to above 100 billion a day, although that’s not exactly the same thing as using it as a means of exchange to buy goods and services.
Bitcoin best performing asset of the decade, and this year
However, as a store of value bitcoin is proving itself.
“The reason why bitcoin is getting so much attention is it’s the best performing asset in the past decade. It’s drastically outperformed the S&P and every other asset that’s out there.
“And secondly, the institutions are coming in because it actually a better store of value, more transparent and more secure.”
Gary has been writing about cryptocurrencies since 2013 and currently works as the cryptocurrency analyst at interactive investor, the UK’s second-largest online investment platform. Gary contributes for Coin Intelligence News in a personal capacity and none of his commentary should be considered investment advice. Gary is the winner of the ADVFN International Financial Awards 2018 Cryptocurrency Writer of the Year. Contact Gary on twitter at: @gary_mcfarlane