In an appearance on CNBC’s ‘Power Lunch,’ Lou Kerner of Blockchain Coinvestors compared the U.S. Dollar to the failed stablecoin UST. The crypto VC categorized both currencies as “unbacked things” which in the long term “go to zero.”
Kerner went on to compare the pair to Bitcoin, which he believes will reach $1 million by 2031, asserting that the cryptocurrency has been, “the greatest investment opportunity in our lifetime.”
This is in sharp contrast to the U.S. Dollar which he predicts will devalue significantly over time.
“What we just saw happen in the crypto world, is an unbacked security – or what they thought was a stablecoin – but it was unbacked,” he said in reference to UST. “Eventually, unbacked things that people don’t have natural demand for go to zero. The U.S. dollar is another unbacked thing, that people like myself who believe in bitcoin think that we’re going to see dramatic declines in the dollar over time. The one thing we can actually have faith in and believe in is bitcoin because we know how many there are.”
On that statement, Kerner was challenged by the host of CNBC’s Power Lunch. The first challenge came regarding the scarcity of bitcoin since each bitcoin is divisible by 100 million satoshi. The second challenge came from the volatility of the asset and its fluctuating prices.
Kerner ignored the first point to answer the second.
“The highest growth opportunities are also those with the most volatility,” said Kerner, who successfully held Facebook stocks through several price cycles, ultimately selling for significant profits.
A ponzi strategy
Lou Kerner ended by dismissing calls for greater regulation. The Partner at Blockchain Coinvestors instead stood up for individual freedom and the people’s right to invest in whatever they like, even if those investments are really, really bad.
“What’s super interesting to me about Terra – a lot of people called it a ponzi scheme, I called it a ponzi strategy. A scheme is when you lie to people about what you’re doing. They were very transparent about what they were doing and if people want to believe in the religion of Do Kwon I think that they should have the right to do it,” said Kerner.
Finally, Kerner suggested that DAI might be a better stablecoin alternative since it was actually backed by something.
In March, Terra CEO Do Kwon promised that “By my hand, DAI will die.”
In reality, Do Kwon’s knockout punch backfired. DAI continues to perform strongly, with UST out for the count. Do Kwon, now KO’d.
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