Cryptocurrencies have no intrinsic value,” says South African hedge fund guru – Blockchain

Jean-Pierre Verster, the founder of South African hedge fund Protea Capital Management, said he does not believe cryptocurrencies have any “intrinsic value.” He insists that cryptocurrencies have “elements of a Ponzi scheme” and has not invested in them for this reason.

A “wonderful technology”

In remarks during a interview However, Verster appears to take a stance on blockchain technology similar to that of cryptocurrency opponents. He explained:

I think blockchain technology is a wonderful technology. And will find applications when it comes to open ledgers - when it comes to transactions that you need to make sure are recorded somewhere or recorded in a place that people can't trace - fiddling with those records. Blockchain is great for this.

Although he points to foreign exchange restrictions and hyperinflation as some of the legitimate factors contributing to the popularity of cryptocurrencies, Verster still attacks “the application of blockchain in cryptocurrencies.”

Inevitable crash

He also warns of an inevitable crash if all the people who wanted to get involved in the currencies finally do so. Verster further explained:

So it has these elements of a Ponzi scheme, meaning that over a long period of time prices go up, up, and it looks like the value is going up, and then it all collapses. So I haven't invested in crypto myself.

These latest anti-crypto comments from Verster – who also confesses that he is not a crypto bull – are a repeat of his contempt for forms of investment that make him “dependent on the value of the other person”.

Do you agree with what Verster said about cryptocurrencies? Tell us what you think in the comments section below.

Photo credits: Shutterstock, Pixabay, Wiki Commons