Tyler Winklevoss, Gemini exchange founder and twin brother to Cameron, tweeted a response to Bill Gates on Monday that Bitcoin is easy to short. This was in response to the tech giant who said that he would short Bitcoin if he could.
He said: "Dear @BillGates there is an easy way to short bitcoin. You can short
#XBT, the @CBOE Bitcoin (USD) Futures contract, and put your money where your mouth is! cc @CNBC @WarrenBuffett."
On Monday, CNBC reported that Microsoft founder Bill Gates said he would short Bitcoin while speaking on 'Squawk Box'. He said: "As an asset class, you're not producing anything and so you shouldn't expect it to go up. It's kind of a pure 'greater fool theory' type of investment. I agree I would short it if there was an easy way to do it."
The greater fool theory referred to is an idea that underlies price bubbles, where the price of an asset rises quickly before crashing. The premise is that more and more people purchase the asset in the belief that someone will buy it from them at a higher price later on. The theory asserts that the price stops rising when there are no more people, or 'fools', willing to buy.
One way of shorting a stock or cryptocurrency means borrowing some in the expectation that the price will go down and the original amount can be returned leaving a profit. This is done using margin trading. Other options include using a futures market and binary options trading. In contrast, going long is done with the expectation that the price will rise.
In March, Bill Gates, who used to be the richest man in the World, said that cryptocurrencies are killing people because they are used to buy illegal and dangerous drugs. He referred to the privacy element of cryptocurrencies which are advertised by such coins as Monero, Zcash and Bytecoin, the latter rising 169% on Tuesday following being listed by Binance. Bill Gates is a leading philanthropist, having given $35 billion to charity.
The Winklevoss twins own the crypto exchange Gemini, currently ranked #32 for crypto exchanges with a 24-hour volume of $54,700,000. On Tuesday, Gemini released details of a partnership with Caspian, a full-stack crypto trading and risk management platform for institutional investors. It recently announced support for block trading on cryptocurrencies where investors can buy and sell large amounts of assets, separately from the regular exchange.