Bill Gates Claims NFTs Are ‘100 Percent Based On Greater Fool Theory’
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Microsoft founder Bill Gates has slammed NFTs yet again by claiming they're '100 percent based on greater fool theory,' the idea there's always a bigger idiot you can sell to.
Gates has made no secret in the past of his disdain for NFTs, the cryptocurrency which gives buyers ownership of a certain image and a bit of blockchain which records their ownership.
Speaking at a climate change event, Gates slammed NFTs and insisted he preferred to invest in things which actually made something like farms or factories.
He had previously warned potential investors to stay away from 'manias' such as cryptocurrency unless they had massive amounts of money to absorb volatile prices.
His warnings appear to have been wise as a crash in crypto value has left many big spenders holding an asset worth less than they paid for it, meaning they must either cash out on a loss or hope prices rise again.
Bill Gates tells us what he really thinks of Bored Apes at #TCClimate: pic.twitter.com/vBc8BaaTup— TechCrunch (@TechCrunch) June 14, 2022
Big crypto investors like the nation of El Slavador are down massively on their investments, while many are still wondering what NFTs are actually for.
Since NFTs don't really appear to do anything and someone buying one in the hopes of selling it off for profit relies on someone else coming in with money, it's hard to disagree with Gates' assessment.
Almost anyone who buys an NFT is eventually going to want to sell it off to someone else for an even higher price, and so on and so forth.
This is where the 'greater fool theory' Gates mentioned kicks in as each NFT needs a constant supply of people ready to buy for a higher price than the last person.
The alternative which Gates predicts will happen is that at some point everyone will realise the game is up and one unlucky idiot will be left holding the NFT with no bigger buyer to sell it off to.
In that case they'd have to take a loss or hang onto their worthless picture of a monkey smoking a cigarette that does nothing.
So long as there is still a greater fool to sell to, the people with NFTs will be able to offload them and convert their pictures into actual cash money.
If and when that stops being the case, it's going to be a disaster for the last person to buy the NFT.
NFT prices have fallen sharply along with the value of many cryptocurrencies in recent months, with some having more than halved in value.
According to The Verge, purchases of NFTs have actually increased recently as investors hope they are buying while prices are at rock-bottom following the crypto crash.
If that's the case then they're hoping they can sell the NFTs they're buying now to a 'greater fool' once the market recovers.
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Topics: Technology, Bill Gates, Cryptocurrency