“I think it’s very important to make a distinction between a bubble and a fraud.”

So says Glenn Hutchins, the co-founder of private equity firm Silver Lake and one of the panelists this morning during CoinDesk’s Consensus: Invest event.

Appearing alongside Galaxy Investment Partners CEO Michael Novogratz and Brian Kelly Capital founder Brian Kelly, his remarks came during a wide-ranging discussion that touched on the valuation of tokens, the future of the industry and how both Hutchins and Novogratz first became involved with bitcoin.

For Novogratz – a long-time investor in bitcoin and ethereum who has predicted significant price gains over the next year – the “eureka” moment occurred once he and his partners began to investigate the technology more deeply, after initial purchases.

“So we went from owning BTC to investing in the ecosystem,” he said.

Hutchins quipped that he “bought BTC only as a last resort,” noting that he initially looked at the mining space as a possible place to invest – but in his own words, he “couldn’t figure out who was going to win.” Hutchins, as reported last year, later went on to become a board member for industry investment firm Digital Currency Group.

Yet the bulk of the conversation turned on two approaches to investing in cryptocurrencies: either the assets themselves or the companies working to build products and services around them. As Novogratz noted, it’s “hard” to find a firm working in the space that would have generated as much as a return compared to simply buying the assets themselves.

Novogratz went on to predict that the ecosystem is set for more proliferation of projects, though he posited that there won’t be many “winners” for each use case, citing examples like decentralized cloud storage and ride sharing.

“I don’t think you’re going to have lots of winners in each use case, but you’re going to have lots of different blockchains,” he said.

As might be expected, the conversation later turned to the argument that cryptocurrencies are either a bubble or a “fraud” – the latter argument being advanced most notably by JPMorgan Chase CEO Jamie Dimon.

For Hutchins, the “fraud” moniker is one that shouldn’t be tossed around so lightly.

“I think it’s very important to make a distinction between a bubble and a fraud. Even when there was a bubble, if you bought the best you would have made money,” he told attendees, adding: “I did not say this is a bubble.”

“I think this is going to become the biggest bubble of our lifetime by a longshot,” Novogratz said in reply, prompting Hutchins to say:

“I want the record to show I didn’t say that.”

Disclosure: CoinDesk is a subsidiary of Digital Currency Group.

Image by Nikhilesh De for CoinDesk