“Black Swan” author Nassim Nicholas Taleb (Nassim Nicholas Taleb) said that investors should not buy Bitcoin. To deal with the current turbulent market, he suggested buying stocks or real estate, and emphasized that Bitcoin has nothing to do with inflation or “any economic factor”.
Nassim Taleb advises against investing in Bitcoin
The famous “Black Swan” author Nassim Nicholas Taleb (Nassim Nicholas Taleb) shared his views on Bitcoin and how to hedge against the current turbulent market in an interview with CNBC on Friday. Taleb is a Lebanese-American scholar, mathematical statistician, former options trader and risk analyst.
Someone asked him about cryptocurrencies, especially Bitcoin, because investors are increasingly using this asset class to restructure their investment portfolios. Regarding Bitcoin, “it has the characteristics of an open Ponzi scheme. Everyone knows that this is a Ponzi scheme,” he claimed, adding:
Basically, there is no connection between inflation and Bitcoin. not any. You may experience hyperinflation and Bitcoin drops to zero. There is no link between them.
Taleb acknowledged that Bitcoin is “a beautifully set cryptographic system” and insisted that “Bitcoin is well-made, but there is absolutely no reason to associate it with any economic factors.”
He suggested: “If you want to hedge against inflation, buy a piece of land and add that people can grow olives on it. You will have olive oil.” He continued, “Of course, for investors, the most A good strategy is to have something that can generate benefits in the future.”
Although many analysts support Taleb’s theory that Bitcoin is not an inflation hedge, some are the opposite. Investment bank Goldman Sachs stated in December that “Bitcoin is a retail inflation hedge” and pointed out that “Bitcoin is replacing gold as the preferred inflation hedge”. British investment management company Ruffer wrote that Bitcoin “acts as a hedging tool for some of the currency and market risks we see.” Observed by Deutsche Bank, “it seems to be using Bitcoin to hedge against dollar risks and inflation. And other factors, the demand for using Bitcoin is increasing.”
Taleb concluded last Friday’s interview on how to hedge the risks in today’s market, saying:
Stay away from Bitcoin. Buy stable stocks and buy what you know.
He also reiterated that investors can also “buy a piece of land” and plant something on it, just like his previous olive example.
The famous author was originally a supporter of Bitcoin and believed that BTC could be used as a currency. However, when he saw that the price of Bitcoin was very volatile and investors were using cryptocurrency as a speculative tool, he began to sell his Bitcoin and began to call it a failed currency.
What do you think of Nassim Taleb’s advice on Bitcoin? Let us know in the comments section below.
Picture Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for reference only. It is not a direct offer or solicitation of an offer, nor is it a recommendation or endorsement of any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. The company or the author shall not bear any direct or indirect responsibility for the use or reliance on any content, goods or services mentioned in this article or any loss or loss related to it.