Nassim Taleb on bitcoin

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The Times named him a prominent thinker of our time, and Forbes included him in its list of the world’s most influential financiers. Nassim Taleb predicted the market crash in 2008 and the beginning of the coronavirus epidemic in 2020. The philosopher is not only known for his ideas about hard-to-predict events. In 2018-2022, many people read what Nassim Taleb wrote about bitcoin and blockchain technology. Until 2020, he supported cryptocurrencies and even bought BTC for investment purposes. However, in recent articles, the writer criticizes blockchain and claims that the value of digital gold is zero.

Brief biography of N. Taleb

American economist, trader, financial analyst was born in 1960 in Libya. After 15 years, the family moved to the United States. Nassim read a lot, wanted to do science. Later he graduated from the Wharton School of Business. In 1998, the future writer received a doctoral degree from the University of Paris-Dauphine.

After that, he traded stocks on the stock exchange. The trader founded the hedge fund Empirica LLC, focused on transactions with futures and options. In 2006, he left the stock exchange and went into science. After the publication of the book “Black Swan: Under the Sign of Contingency”, which describes the principle of randomness, the economist focused on literature. Taleb published 5 more works and a large number of scientific articles. The writer also maintains pages on Twitter.

What is famous for

The financial analyst gained international fame after the publication in 2007 of the work “Black Swan: under the sign of contingency”. In 2012 he published “Antifragility: Things that benefit from disorder”. Both books became bestsellers. In 2022, they are read in 32 languages. The total circulation is 10 million copies.

In The Black Swan, the author argues that bad decisions do not always lead to failure. He is sure: the state of the economy depends on events that cannot be predicted. The philosopher describes a society that can resist such phenomena. The book still causes a lot of controversy in society.

Nassim Taleb was a successful stock trader. He made startlingly accurate predictions about changes in the global economy. In 1987, when the Dow Jones Industrial Average lost more than 20% of its value in a day, the publicist earned $40 million.

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The coronavirus epidemic was dubbed the “black swan” by the media. This added to the popularity of the philosopher’s books. Back in 2017, he warned that the world would face a new disease that would reach pandemic proportions. The writer later noted that the devastating effects of the coronavirus were due to the fact that many people underestimated the threat.

Major books

In 2006, the financier engaged in science, began to write books and articles. To better understand the ideas of the thinker, it is worth reading his works.

Book	What the author writes about
“Black Swan. Under the sign of contingency”	Governments make plans based on the concepts of risk management. But economies are affected by events that cannot be predicted.
“Fooled by chance. On the hidden role of chance in business and in life.”	The book gives scientific interpretations of luck and probability. The author discusses what prevents people from making the right decisions and why people look for connections and patterns where there are none.
“Antifragility: things that benefit from clutter.”	The author explains how stresses encourage you to develop and stand firm. The book gives tips on how to cope with and benefit from problems.
“Risking Your Own Skin. The Hidden Asymmetries of Everyday Life.”	In the work, Taleb develops his ideas. He states: people’s actions are influenced by the instinct of self-preservation. If people were not afraid “for their own skin”, they would be able to make the right decisions more often.
“On the Secrets of Resilience. In the footsteps of the Black Swan. Procrustean bed.”	The book is published 3 years after the first bestseller. The author answers critics’ questions and develops thoughts on the principles of randomness.

A well-known economist and publicist on the prospects and future of the BTC cryptocurrency

In 2017-2019. Nassim Taleb wrote positively about Bitcoin and blockchain technology. In his publications, he supported digital gold and criticized the government-controlled banking system. Taleb argued that Bitcoin is the first organic currency. He wrote: creating digital money is a good idea. The strength of BTC is that it cannot be controlled by central banks. The publicist warned: such properties of Bitcoin will be used by the creators of financial pyramids to deceive people. However, this is a necessary evil that does not outweigh the main advantage of decentralization – the lack of government control. Taleb saw promise in blockchain technology.

In 2020-2022, the scientist changed his position. His publications about BTC became harsh. The writer publicly quarreled with the participants of the cryptocommunity. He called bitcoin holders “complete idiots” and “unicellular”, and digital gold a “Ponzi scheme”.

The former cryptocurrency proponent rejected the idea of hedging risk with bitcoin. He called people who invest in BTC “scammers with a certificate”. The writer stated: the cryptocurrency is of interest only to speculators. In 2021, he argued that Bitcoin cannot become a currency without a government. To be a means of payment, digital gold must have stability and be easy to use. The scientist predicted the collapse of the cryptocurrency. According to him, it will happen when everyone decides to take their investments and there is no one who wants to buy even one coin.

Why Taleb has changed his opinion on Bitcoin

In recent articles, the publicist speaks sharply about the cryptocurrency. He names such reasons for the future failures of Bitcoin:

The fragility of the asset. The main cryptocurrency is “worth exactly zero”. It needs the constant attention of users to maintain quotes. Unlike digital currencies, precious metals have value and do not need maintenance.
High volatility. People will not invest in an asset that fluctuates more than commodity prices.
BTC does not protect against political decisions because it depends on global currencies. Transparency of blockchain technology allows you to control transactions.
The hysterical nature of the cryptocurrency market. BTC reacts sharply to liquidity. It is not clear what consequences a regional lack of connectivity during a financial meltdown would lead to.

The writer admitted to being fooled by the idea that Bitcoin could replace fiduciary money.

Taleb realized that a currency that is not backed by the government is a gamble. The philosopher announced the decision to sell the assets he owned.

Best quotes by Nassim Taleb about Bitcoin

The famous publicist has written many times on Twitter and academic articles about cryptocurrency and blockchain technology. Nassim Taleb said the following about BTC:

“Bitcoin is the beginning of something great. A currency without a state, something necessary … “.
“Bitcoin’s main purpose is to scare the bankers.”
“BTC is an insurance policy to remind governments that they no longer have a monopoly.”
“It (Bitcoin) cannot be used as a defense against systemic risk.”
“Bitcoin is worth exactly zero.”
“There is no link between inflation and cryptocurrency. Everyone knows that BTC is a Ponzi scheme.”

Frequently Asked Questions

✅ Who is Nassim Taleb?

He is an American trader, philosopher, and publicist. He gained worldwide fame after the publication of the book “Black Swan. Under the Sign of Contingency”. In the work, the author described how unforeseen events affect the world economy.

❓ Did the writer know about the coronavirus?

In 2017, he said he saw danger to the global financial system. Among other risk factors, the publicist cited diseases that society would not be able to cope with.

💡 What else is the writer famous for?

The philosopher is known for his predictions of financial crises. Bloomberg wrote that thanks to his publications, investors were able to earn millions of dollars.

🧐 What did the thinker say about BTC?

Until 2020, he supported cryptocurrencies. After the collapse of the exchange rate, the philosopher became disillusioned with digital money as a means of payment.

❗ Why did the scholar change his opinion about cryptocurrencies?

In March 2020, the digital market fell harder than the stock market. The massive injection of liquidity affected not only stocks, but also cryptocurrencies. In the writer’s opinion, it confirmed that bitcoin is no defense against systemic risk.

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Author: Saifedean Ammous, an expert in cryptocurrency economics.