Bitcoin represents the trust and freedom lacking in the fiat world: Tim Draper

Draper questioned whether individuals will continue to want to depend on political whims that decides the supply of fiat currency to protect their assets.

Global venture capital firm Draper Associates founder Tim Draper said that the reliability, scarcity, transparency and worldwide accessibility of Bitcoin make it a viable alternative to fiat currency.

In an interview with Bloomberg's Amanda Lang and Taylor Riggs on ‘Bloomberg Markets’, Draper said that Bitcoin represented the trust and freedom in a world that is starting to get less of both:

“There is only 21 million Bitcoin. They represent the freedom that allows us to use them anywhere. The trust is in software rather than a government, bank or other entity.”  

The venture capitalist explained that Bitcoin acts as an inflationary hedge in an environment where governments are printing fiat currency without considering the long-term effects of such policy actions.

However, Draper cautioned that altcoin projects built on blockchain are also capable of inflation. He advised that it was important to consider the profile and vision of the engineers and entrepreneurs behind a token before investing in it.

Tasos is one of the upcoming tokens that have caught the venture capitalist’s eye for its ability to renew the functioning of a token and implement a sustainable proof-of-stake system. Draper added that Aragon is another exciting token that will redefine how juries work.

Draper stated that blockchain, cryptocurrencies and smart contracts are slowly but surely transforming some of the biggest industries in the world. He pointed out that such changes are already visible in banking and in the future will take over commerce, government and insurance.

Speaking of government, Draper believed that the pro-crypto stance of South American countries are working in their favour. He stated that entrepreneurs are viewing the regulatory environment in countries like El Salvador and Uruguay as a major opportunity to promote innovation.