A few billionaire buddies were asked for their opinions on bitcoin. Holders won’t like what they had to say.

This past weekend, Berkshire Hathaway hosted its annual shareholder meeting in Omaha, Nebraska. In addition to discussing the company’s increased stake in Apple, Warren Buffett and longtime business partner Charlie Munger were asked their opinions on cryptocurrencies. As might be expected of value investors, they didn’t have anything nice to say about bitcoin.

Buffett

“Generally, nonproductive assets remain [nonproductive],” declared Buffett. “If you had bought gold at the time of Christ and you figure the compound rate on it, it may be a couple tenths of a percent.”

Many in the cryptocurrency community have argued that bitcoin is a form of digital gold, which could make Buffett’s point distressing to bitcoin speculators. Alluding to the artificial scarcity of cryptocurrencies, he said, “You can only mine so many [bitcoin], but so what?” He posited the rhetorical question of what cryptocurrency actually produces.

Buffett’s point is that just because something is rare, that doesn’t make it intrinsically valuable. If anything, that could be reason to apply even closer scrutiny before investment.

“Anytime you buy a nonproductive asset, you are counting on somebody else later on to buy a nonproductive asset because they think they can sell it to somebody for more money,” Buffet lectured. “In the end, you make your money out of productive assets.”

He used a farm as an example. A potential buyer might estimate the productivity of a tract of land, estimate the wages that must be paid to workers, and gauge potential tax liabilities. “You make a conclusion based on what the asset itself will produce over time and that’s an investment,” Buffet dispensed.

The Oracle of Omaha also laid into cryptocurrency speculators.

“When you buy something because you’re hoping tomorrow morning you’re going to wake up and the price will be higher, you need more people coming into it than are leaving,” he said simply. “You can get that and it will feed on itself for a while – and sometimes for a long while – and sometimes to extraordinary numbers. But they come to bad endings and cryptocurrencies will come to bad endings.”

Buffett additionally raised concerns about the scam artists and predatory financiers who are piling into (and out of) crypto-assets. “It’s something where people who are of less-than-stellar character see an opportunity to clip people who are trying to get rich because their neighbor’s getting rich buying this stuff and neither one of them understands.”

Munger

As if Buffett’s tirade were not enough, Munger ripped cryptocurrencies even further. “Well, I like cryptocurrencies a lot less than you do,” he cracked. “To me, it’s just dementia.”

“I think that people who are professional traders that go into trading cryptocurrencies, it’s just disgusting. It’s like somebody else is trading turds, and you decide, I can’t be left out.”

On Monday, Munger renewed his attack.

“Bitcoin is worthless artificial gold, which, if it succeeded, would sow a lot of illicit activity. Now that is not something, I think, the world needs,” he said. “And the fact that it’s clever computer science doesn’t mean that it should be widely used, and that respectable people should encourage other people to speculate on it. Bitcoin reminds me of Oscar Wilde’s definition of fox hunting: the pursuit of the uneatable by the unspeakable.”

Gates

Amid that rebuke, it might be hard to confess owning any bitcoin, but luckily Bill Gates said that he has sold the small amount that he received for his birthday. Of course, Gates – as a much younger technologist (even at age 62) – also had some positive things to say about blockchain development at large.

“There’s some really good technology in terms of sharing databases and verifying transactions that is talked about as blockchain. That is a good thing,” he said.

However, on bitcoin and ICOs, Gates agreed with Buffett and Munger. “It’s one of the crazier speculative things, where as an asset class, you’re not producing anything, so you shouldn’t expect it to go up. It’s kind of a pure ‘greater fool theory‘ type investment.”

The Microsoft titan added, “I would short it if there was an easy way to do it.”

Note: Warren Buffett has said that while he would buy five-year put options on cryptocurrencies, he wouldn’t short a dime’s worth.

Despite these many warnings about bitcoin and cryptocurrencies, it could be worth keeping an eye out for productive blockchain-based assets. The billionaires didn’t offer any commentary on whether they perceive a future for non-bitcoin decentralized economies or products.