Peter Thiel, co-founder of PayPal, Facebook board member, former advisor to Trump and a conservative libertarian born in Germany raised in America, said he is long on bitcoin. We quote at some length:
“There’ all these elements that remind me of 99-2000 that make me nervous. So people playing fast and loose with ICO rules, just like with the IPOs in the dotcom bubble.
You have sort of the, the crazy promoter type people, where the people who exaggerate beat the people with a normal plan and they get beaten by the people who exaggerate a lot. And so, there are sort of a lot of crazy, unhealthy dynamics.
At the same time, it still strikes me as deeply contrarian. And one thing that’s very different from the dotcom bubble in the late 90s, is there’ virtually no Wall Street analysts, no Wall Street banks that are pushing this in any way whatsoever.
Whereas, if you looked at how many analysts working on dotcom companies in 1999, 2000, that was way too many, and that was probably another small indicator that it was too consensus.
Its been missed in New York City, its been missed even more shockingly in Silicon Valley. It is a technology that sort of emerged in this very distributed way.
Ethereum, the number two currency, most of the work is being done in Zug, Switzerland. Bitcoin, of course, has this mystery where people don’t even know who created bitcoin.
They don’t know who Satoshi, the founder of bitcoin is, so from a geographic perspective, we actually have no idea where the company got started.”
Thiel said he is a hodler, which mean, he said, hold on for dear life. If we look at probabilities, he said, bitcoin might have a 50%-80% chance of going down and a 20%-50% chance of going up a lot more. Those probabilities are good, he said, so he doesn’t trade and just hodls.
Bitcoin is not convenient for payments, he said, it’s more like gold. And if you look at the two, they share the same qualities. Silver could overtake gold, but that’s not happened he said, so another currency, ethereum, could overtake bitcoin, but he’s betting on the biggest.
Money is a stable bubble, he said. Money by nature has bubble qualities, but it can be very stable, he said.
Interestingly, he did not mention ethereum much at all, suggesting he might be unfamiliar with it. Apparently he bough some bitcoin with it reported in January, but he says he actually bought them a lot before then.
When he bought them exactly is unclear. In 2014, he wasn’t very enthusiastic about cryptos, in 2017 he was.
So that might suggest he might be a new cryptonian, further strengthened by him saying Silicon Valley missed it and by Elon Musk being recently spotted with a very basic book on cryptos.
This adds to a feeling that the phase cryptos are now is institutional investors, so moving from early adopters to the second major phase of tech adoption.
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