Warren Buffett, the legendary investor, remains staunchly opposed to Bitcoin, insisting that he wouldn’t buy the cryptocurrency even if it were priced at $25. However, his company, Berkshire Hathaway, continues to profit from cryptocurrencies through its investment in the Brazilian fintech company Nu Holdings.
Despite Buffett’s public criticism of Bitcoin, calling it "rat poison," Berkshire Hathaway has reaped substantial gains through its stake in Nu Holdings.
Initially, Berkshire invested $500 million in the G round of financing and later added another $250 million, and these investments have paid off handsomely.
In a 2018 interview with Yahoo Finance, Buffett questioned Bitcoin's value. He said, “If you told me you owned all the Bitcoin in the world and offered it to me for $25, I wouldn’t take it because what would I do with it?”
He continued, “No matter what, I’d have to sell it back to you, it wouldn’t do anything.”
He believes Bitcoin lacks productivity and relies solely on future price increases.
Nu Holdings, founded in 2013, launched the Nucripto platform in 2022, allowing users to trade over 15 types of tokens. The company’s performance has been impressive, with the market surging 100% in 2023 and nearly 50% at the beginning of 2024.
The success of this investment has put Buffett in a difficult position, as Nu Holdings' performance has increased by nearly 125% this year, starkly contrasting with his negative stance on Bitcoin.
Meanwhile, Bitcoin itself has performed exceptionally well in 2024, far outpacing indices like the S&P 500.
Warren Buffett's strong opposition to Bitcoin dates back several years, consistently viewing it as a non-productive asset without intrinsic value.
Buffett’s indirect investment in cryptocurrencies through Nu Holdings highlights a subtle shift in his investment strategy.
As reported earlier this year, Berkshire Hathaway's increasing investments in companies involved with cryptocurrencies might reflect market dynamics.
At the beginning of 2023, reports indicated that the global adoption rate of fintech was rising. This trend underscores why, despite Buffett’s personal skepticism, Berkshire remains committed to fintech investments.
Buffett's portfolio management consistently emphasizes long-term profitability over short-term market trends. This strategy may explain why, despite his well-known views on Bitcoin, Berkshire continues to support Nu Holdings.
The broader implication is that even a staunch critic like Buffett can find profitable opportunities within the evolving digital asset ecosystem, marking an important aspect of financial diversification and adaptability.
More and more listed companies regard Bitcoin as an important asset and continue to expand their holdings, showing signs that Bitcoin is gaining widespread recognition at the corporate level.
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Financial Times