Billionaire investor Peter Thiel believes bitcoin critics are “underestimating” the cryptocurrency’s “great potential” to become the “cyber equivalent of gold”.

Peter Thiel: Bitcoin Has ‘Great Potential Left’

The bitcoin price has increased nearly 800% in the past year and is currently trading slightly below $6,000, leading many analysts to claim that it is trapped in a “speculative bubble”. Others, like Peter Thiel, believe that these critics are “underestimating the “great potential” that bitcoin has left.

In an interview on Fox Business Network’s (FBN) Mornings with Maria Thiel, a PayPal co-founder and early Facebook investor, made these comments at the Future Investment Initiative in Riyadh, Saudia Arabia, stating that he believes bitcoin could become the digital equivalent of gold:

“If bitcoin ends up being the cyber equivalent of gold it has a great potential left,” he said, “Bitcoin is mineable like gold, it’s hard to mine, it’s actually harder to mine than gold. And so in that sense it’s more constrained,” he added.

However, Thiel added that he is skeptical that other cryptocurrencies have the same degree of potential that bitcoin has, alluding to the fact that many altcoins have purported to achieve the chief ends of cryptocurrency more effectively than bitcoin. He stressed that bitcoin can serve as a “reserve form of money,” so “You don’t need to use it to make payments”:

“I’m skeptical of most of them (cryptocurrencies), I do think people are a little bit … underestimating bitcoin especially because … it’s like a reserve form of money, it’s like gold, and it’s just a store of value. You don’t need to use it to make payments,” Thiel said.

Silicon Valley Embraces Bitcoin

Thiel is one of many Silicon Valley fixtures to soften toward bitcoin after initially expressing skepticism about the idea of cryptocurrency. As recently as 2014, Thiel had expressed that he was not optimistic bitcoin could achieve mainstream adoption until it was “used to make more legal transactions”. However, he embraced bitcoin later on after watching the ecosystem grow.

Apple co-founder and fellow Silicon Valley icon Steve Wozniak awarded similar praise to bitcoin earlier this week at the Money 20/20 conference in Las Vegas. Stating that the government’s ability to print fiat currency at will made it “kind of phony”, Wozniak stated that he believes bitcoin’s mathematical properties make it superior to the U.S. dollar and even gold.

“Gold gets mined and mined and mined,” he said. “Maybe there’s a finite amount of gold in the world, but Bitcoin is even more mathematical and regulated and nobody can change mathematics.”

However, Thiel’s comments diverge from those of Saudi billionaire investor Prince Alwaleed bin Talal, who stated earlier this week that bitcoin is “going to implode” due to a lack of regulatory supervision.