US billionaire Warren Buffett said bitcoin is an effective money transmitter without any intrinsic value and warned people to "stay away from it".
During an interview with CNBC, the CEO of Berkshire Hathaway compared the popular digital currency to a "very fast money order."
"It's a mirage basically, it's a method of transmitting money, it's a very effective way of transmitting money and you can do it anonymously and all that... a cheque is a way of transmitting money, too. Are cheques worth a whole lot of money?" he said.
However, he admitted that bitcoin is a promising technology.
"I hope bitcoin becomes a better way of doing it. But you can replicate it a bunch of different ways, and it will be. The idea that it has some huge intrinsic value is just a joke in my view," Buffett said.
The world's fourth richest man had earlier said he would not invest in bitcoin because he does not consider the virtual currency as a reliable store of value or means of exchange.
While many bitcoin enthusiasts refuted Buffett for the way he assessed the digital currency and its underlying technology, the latest statements from the 'Oracle of Omaha' are expected to strongly influence the financial community.
Bitcoin was launched in 2008 and is traded within a global network of computers. They can be transferred without going through banks or clearing houses, reducing fees involved in the services significantly.
Confidence in bitcoin took a serious knock thanks to the collapse of Japan's MtGox which had hosted 80% of the world's bitcoin trade. The company filed for bankruptcy protection in Japan on 28 February.
Governments across the globe have made different decisions regarding businesses related to bitcoin. While some have banned any dealings in the currency, some others have come up with pro-active policies that consider bitcoin firms just like any other tax-compliant companies.
Russia earlier banned the use of the currency completely, while China has restricted it as a means of payment. It is legal in the US as a "payment innovation", but will not be monitored by the central bank in any way.
Many other countries have warned consumers about the risks of digital currencies, and urged them to be cautious while dealing in such currencies.