On a recent segment of CNBC’s Market Alert featuring prominent investor Mark Mobius, the conversation quickly turned to gold, fiat currencies, and of course, Bitcoin.
Mobius’ comments about Bitcoin requiring gold-backing to have inherent value was immediately met by criticism from the crypto world’s favorite financial analyst, Joe Kernen, host of CNBC’s Squawk Box.
Prominent Investor: For Bitcoin To Have Value, It Needs Gold Backing
Bitcoin has many narratives, with many of them coming to light at a different rate, or coming into focus more so than another at certain points depending on the overall global climate and where the crypto market is at.
During the 2017 bull run, crypto investors began to hold Bitcoin for the long-term hoping its value would increase, resulting in the “store of value” narrative taking the center stage.
Related Reading | Analyst Claims Current Bitcoin Bull Run is “A Store of Value in the Making”
More recently, the narrative has switched to “Bitcoin as a safe-haven asset,” rising in price amidst growing global economic turmoil and alongside precious metals.
Yet another narrative is the “Bitcoin as digital gold” narrative, that plays into both gold’s use as a safe-haven asset and as one of the oldest stores of value on the planet. However, prominent investor Mark Mobius not only doesn’t think Bitcoin is digital gold, he says that for Bitcoin to have value at all, it really needs to be backed by the precious metal it’s said to be the digital counterpart of.
But Mobius’ comments were met with opposition by Joe Kernen, host of CNBC’s Squawk Box and recent crypto skeptic turned supporter. Kernen questioned Mobius on why he didn’t believe that blockchain technology itself is what “imbues” value into Bitcoin, suggesting that Bitcoin didn’t need gold at all to flourish.
Like the dollar. wait https://t.co/7xbA6ubI3A
— Joe Kernen (@JoeSquawk) September 5, 2019
Kernen also challenged Mobius on why he didn’t express the same sentiment toward fiat currencies, which aren’t backed by gold yet still have value. Mobius says that’s due to the faith people have in those fiat currencies and the governments that back them. Mobius contradicted himself later by saying that people also have faith in cryptocurrencies.
Mobius then goes on to issue a warning about cryptocurrencies and blockchain, saying that anything man-made can be hacked into, despite many believing Bitcoin’s network to be completely sound.
Related Reading | Bitcoin Store of Value Narrative Turning Toward Safe Haven Asset
Gold is a precious metal mined from the earth itself, and cannot be hacked, giving Mobius and others who invest in gold more peace of mind. However, as the digital age progresses, the need for a currency and store of value to have many of the same attributes of gold will become more necessary, and that asset is Bitcoin.