Gates or Musk, who is right?

Gates or Musk, who is right?


Written by: Marilu Lazo Mac Dowall

Associate at Lawgic Tec and Blogger at The Crypto Legal

 

In a market as volatile as the cryptocurrency market, the opinions of the most influential individuals in the economy can quickly “shake the market”, even a simple tweet from the right person can have a great effect on its market price. Ordinary citizens and even “experts” could be influenced by these opinions to the level of trusting them to enter or leave the market. Fortunately for them, the market has many different opinions about digital currencies.

 

In this sense, Bill Gates has expressed in numerous interviews that he considers the use of digital currencies to be beneficial, due to their convenience in large transactions, their speed and low cost. However, despite declaring himself “neutral”, there are aspects, especially in the case of those that are decentralized (i.e. no one has control over them, as in the case of bitcoin) that do not convince him. The main one? The anonymity of its participants (alluding to the favoring of illegal scenarios, whether money laundering, terrorist financing or others).

On the other hand, he also points out that the fact that the transactions are not reversible is not convenient. irreversible? It refers that, once the operation has been carried out, it cannot be undone, there is no authority to which it can be resorted to. In the same vein, he highlights the high energy consumption generated by bitcoin mining activity, as well as its highly speculative nature and the fact that the high volatility of the cryptocurrency could, or rather “should” scare away those who do not have money to risk.

“I prefer to invest in companies that make products” he pointed out in contrast to the way to make a return on bitcoin, which is simply to keep the cryptocurrency “locked up” until it can be sold to someone else in the future, when its value will be higher.
In reality, over time, bitcoin has proven to be very sensitive to market activity. A single tweet announcing the purchase of x amount of bitcoins (not even that the purchase is already done) can determine the change in its price on that same day. However, we cannot fail to mention that, although its price has had sudden drops, in general its growth has a positive trend.
On the other hand, we have Elon Musk, owner of Tesla, who bought 1.5 billion bitcoins at the beginning of February, and who announced that he will allow his customers to pay for their cars with this cryptocurrency. In this case, it is clear that opinion cannot be neutral at all, but this does not mean that it is far from reality.

In an interview at the beginning of February (prior to the big purchase) he mentioned that he “regrets having come to the party so late”, (in allusion to the fact that he should have bought bitcoins in previous years when friends of his encouraged him to do so), when the price was clearly lower than the current one. In the same vein, he points out that “bitcoin is a good thing and he is a supporter of it” and that it is on the way to gaining widespread market acceptance.

On the other hand, the characteristic of bitcoin that he has highlighted the most is the fact of having a decentralized database, in clear contrast to the current banking system, in which, each bank has its own database that stores the transactions that concern it and that has significant difficulties, both in time and money, to carry out transactions with other banks, worse still in the case of international transactions.
Finally, another interesting point he has mentioned is the consideration of bitcoin as a viable scenario for illegal transactions, he calls it “a bridge between illegal and legal”.

Source: Daniel Oberhaus/Elon Musk at a press conference/CC BY-SA 4.0