Verster recognizes cryptocurrencies allow cross-border transactions amid hyperinflation and government restrictions to move money. The executive believes that digital assets have no intrinsic value, do not produce anything, and have elements of a Ponzi scheme.
Hedge fund guru Jean Pierre Verster recently spoke about the market and the value of cryptocurrencies. Even though he is against those assets, he recognizes they have certain advantages that have made them grow.
The executive believes that blockchain technology has many applications in open ledgers and records. He also mentioned that they allow making secure transactions as users cannot alter the recorded data.
The founder of Protea Capital Management said that those assets allow making cross-border transactions amid hyperinflation and government restrictions to move money. He highlighted that this is what has made the use of crypto assets so popular.
Regarding his position against cryptocurrencies, he expressed that there is no intrinsic value in cryptocurrencies. Furthermore, he considers that those assets involve elements of a Ponzi scheme, which supposedly prevents him from investing in them.
Verster is Not Interested in Investing in Cryptocurrencies
Jean Pierre Verster noted that the limitations of forex platforms and inflation are legitimate factors driving the popularity of cryptocurrencies. However, he does not stop attacking the use of blockchain technology in those assets.
The guru predicted the troubles of the African Bank and Steinhoff and sold their shares short. He has also said that he did not like speculative assets, for which cryptocurrencies are not part of his investment strategy.
According to the executive, digital assets have no intrinsic value and do not produce anything, so it is impossible to earn interest. He further argued that there could be a crash in the values, which he relates to as a scam.
He expressed that cryptocurrencies have elements of a Ponzi scheme, as their prices rise for a long time and then collapse. Those investment frauds focus their energy on attracting new customers, promising them high returns.
Other Investors Are Against Cryptocurrencies Despite their Clear Advantages
Berkshire Hathaway CEO Warren Buffett and other well-known investors support Verster’s view that Bitcoin and altcoins have no intrinsic value. Former US President Donald Trump recently said that cryptocurrencies are worth nothing, and he associates them with illegal activities.
Verster warned of an imminent collapse if cryptocurrency users wanted to trade currencies. Furthermore, he noted that monetary restrictions and inflation are the fundamental factors favoring the popularity of cryptocurrencies like Bitcoin and Ether.
Although many people have openly expressed their rejection of cryptocurrencies, this has not prevented that market from growing. Some investors believe that Bitcoin and altcoins are worthless and only contribute to illicit activities. However, those assets have helped those wanting to conduct transactions privately without the control of third parties.
Bitcoin and other cryptocurrencies have proved to be efficient tools to fight inflation in countries with many unbanked citizens. They allow people living abroad to send money to their relatives with no intervention from government authorities. Besides, the number of illegal activities committed with them is much lower than with fiat money.
By Alexander Salazar