Famed emerging markets investor Mark Mobius has taken the bitcoin as a ‘digital gold’ argument to the next level, claiming that the cryptocurrency should be backed by a precious metal to give it value.
In an interview with CNBC’s Squawk Box on Sept. 5, Mobius told viewers that he was concerned about the risks involved with investing in bitcoin, including the lack of physical value underlying crypto-assets.
Bitcoin is a cryptocurrency that really needs to be backed by gold to have any value, said famed investor Mark Mobius pic.twitter.com/q5hZ8Xwzxl— Squawk Box (@SquawkCNBC) September 5, 2019
The founder of Mobius Capital Partners was hesitant to agree with the idea that bitcoin has intrinsic value to investors, and said that he would prefer the cryptocurrency if it was backed by gold.
“If there is a cryptocurrency that is really backed by gold, and that is, there is a meaningful agreement and some kind of modern thing of this connection, then this could be quite interesting.”
Squawk Box host and bitcoin analyst Joe Kernen countered Mobius by saying that no current fiat currencies are backed by precious metals, despite the general agreement that they hold value.
Mobius explained that fiat currencies held a shared degree of faith by the public that is ultimately lacking in bitcoin,
“The reason why people believe in the U.S. dollar is because they have faith that with dollars in their hands, they can buy something. So there’s a degree to which if cryptocurrency can enable you to buy something and you believe that to be the case, that’s fine.”
Mobius has previously been tied to championing the value of physical assets such as gold, and claimed that cryptocurrencies would ultimately serve to spur greater interest in precious metals.