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Chairman of Virgin Galactic: everyone should own bitcoin
Chairman of Virgin Galactic: everyone should own bitcoin
Bitcoin

Chairman of Virgin Galactic: everyone should own bitcoin

By Marco Cavicchioli - 27 Feb 2020

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The Chairman of Virgin Galactic, Chamath Palihapitiya, states that everyone should have bitcoin for 1% of their assets. 

During an interview with CNBC, he said that bitcoin is a “fantastic hedge” because it is absolutely unrelated to other assets. 

Palihapitiya is also a venture capitalist, founder and CEO of Social Capital, a minority shareholder and board member of the Golden State Warriors, and in the past, he was also one of the first executives of Facebook. 

He has been an open advocate of bitcoin for a long time and considers it a kind of insurance that can offer protection in times of crisis.

“You quietly over some period of time accumulate a position and then just never look at it again and hope that that insurance under the mattress never has to come due. But, if it does, it will protect you”.

In reality, he specifically refers to those who hold assets in their portfolio as an investment, considering that the utility would actually be to use bitcoin as a protection against risks related to other assets linked, for example, to the global economy. 

In particular, he refers to the enormous leverage that is in place in the financial markets and the fact that there can always be unforeseen external events that can cause prices to collapse. This generates an enormous risk inherent in the markets themselves, which makes it very useful to own an asset such as bitcoin, which is not related to others in the portfolio. 

Furthermore, with regard to Warren Buffett’s opinion about bitcoin, Chamath claims that he is completely wrong, and notes that the definition of bitcoin as “digital gold” is not necessarily correct. Instead, this would be the definition that common people attribute to this new, free-flowing asset, but Palihapitiya argues that it doesn’t make sense to consider it as such. 

In fact, he says that buying bitcoin when the financial markets collapse because of the Coronavirus, for example, is idiotic and that instead, he considers a reasonable strategy to convert 1% of wealth into bitcoin over time, thus accumulating BTC and holding them aside to use only in case of emergency, in the hope that they will never serve to cover the losses of other investments. 

Palihapitiya’s ideas are decidedly sophisticated, and denote a very good knowledge of the bitcoin financial asset, beyond the very superficial common narration that is often given. 

 

Marco Cavicchioli
Marco Cavicchioli

Class 1975, Marco teaches web-technologies and is an online writer specializing in cryptocurrencies. He founded ilBitcoin.news, and his YouTube channel has more than 11 thousand subscribers.

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