Barry Silbert Explains Why Central Bank Digital Currencies Boost Bitcoin
Barry Silbert, the founder and CEO of Grayscale Investments and Digital Currency Group (DCG), has recently expressed his bullish outlook on Bitcoin in a Grayscale investor call on Feb. 12. He covered different issues related to digital assets, such as the role of Bitcoin in the transfer of wealth across generations, decentralized finance, stablecoins and central bank digital currencies (CBDCs).
CBDCs are virtual currencies that are issued and controlled by a federal regulator. Unlike Bitcoin and other cryptocurrencies, CBDCs are fiat money in the digital form. No CBDC has been launched by any global jurisdiction yet, but such projects have been developed and explored by many governments. While China is reportedly getting ready to test its CBDC soon, at least 10% of central banks are expected to issue a CBDC for the general public in the near future.
Barry Silbert millionaire, who claims to have bought his first Bitcoin in 2012, three years after the creation of the first block on the Bitcoin blockchain, argued that central banks that develop their own digital currencies might be giving more power to Bitcoin by creating the infrastructure for institutional interest. He believes that Bitcoin and other non-central bank cryptocurrencies could benefit from the same infrastructure that is used by the widespread adoption of CBDCs: “So at one point of the future we might have 80 different CBDCs. And if that happens, it would trigger a tremendous amount of investment in operators of financial systems where essentially every financial institution would then have to be able to safely store and transact CBDCs and, guess what, if they actually build that infrastructure, that same infrastructure could be used for non-central bank digital currencies like Bitcoin.” He also expressed confidence that central banks will require users to use and engage with the existing financial systems and will not limit the supply of the digital currency. “Central banks love to print money,” Silbert said, highlighting Bitcoin’s limited supply feature.
Silbert is one of the most influential figures in the cryptocurrency industry, as he leads two major companies that are involved in various aspects of digital assets. With over $40 billion in assets under management as of Feb. 12, Grayscale Investments is the world’s largest digital asset manager. Various crypto-related projects, such as Foundry, Genesis Trading and CoinDesk, are invested in by Digital Currency Group, which is a venture capital firm.
For a long time, Silbert has been vocal about his bullish views on BTC and other cryptocurrencies. He has also been critical of some projects, such as Ripple (XRP), which he considers to be centralized and not a true cryptocurrency. He has also forecasted that most altcoins will go bankrupt in the long term, while Bitcoin will continue to dominate the market.
To conclude, Barry Silbert is a prominent figure in the cryptocurrency industry who suggests that central bank digital currencies are positive for Bitcoin. He contends that CBDCs will create the infrastructure for institutional interest in non-central bank cryptocurrencies like Bitcoin. He also points out that Bitcoin has a limited supply feature that makes it superior to fiat money. He leads two major companies that are involved in various aspects of digital assets: Grayscale Investments and Digital Currency Group.