Bitcoin Hits a Peak of $73,776, a Major Turning Point in Buffett's Long-Standing "War"?

Since an interview in 2013, Warren Buffett, often referred to as the "Oracle of Omaha," has continuously criticized the intrinsic value of Bitcoin, even likening it to a scam and rat poison, asserting that cryptocurrencies should not be considered as an investment vehicle, and warning the market against speculative frenzy. However, as Bitcoin reached a peak of $73,776, more people joined the Bitcoin camp, and Buffett's Berkshire Hathaway also entered the arena indirectly.

In May 2013, Buffett said: "Bitcoin is the greatest absurdity that mankind has invented to date; it's an incredibly exciting scam."

In a March 2014 interview with CNBC in the United States, he stated: "Bitcoin is not a currency, it doesn't pass the currency test. I wouldn't be surprised if it disappears in 10 or 20 years. It is not a durable medium of exchange nor a store of value. It's a very speculative kind of thing, akin to Buck Rogers, where people trade them because they expect them to go up or down, just like what was done long ago with tulip bulbs."

He continued, "It's basically a mirage; it's a very efficient way of transmitting money; you can do it anonymously and so on. A check is also a way of transmitting money. Does a check have a lot of money value just because it can transmit money? I hope Bitcoin becomes a better way, but you can duplicate it in many different ways, and to me, the idea that it has huge intrinsic value is just a joke."

"In the next 50 years, owning productive assets will be far better than owning pieces of paper or Bitcoin."

In 2011, Bitcoin hovered at around $1, at a purely conceptual currency stage, with low trading activity and recognition. In June 2011, Bitcoin gained some attention, breaking the $10 mark for the first time, reaching a high of $33.08 that year. In 2012, the overall market was sluggish, with a high of only $13.51.

In April 2013, Bitcoin began to gain more attention, with its price first breaking $200 at the end of the month. In November of the same year, Bitcoin experienced a buying frenzy, reaching a new high of $1,242 at the end of the month before rapidly falling back.

From 2014 to 2015, Bitcoin underwent a prolonged bear market adjustment, with prices falling to around $170 at one point. In 2016, Bitcoin began to rebound, reaching a high of $966 for the year. In 2017, the Bitcoin bull market fully exploded, reaching a record high of $19,891 in December.

In January 2018, Buffett mentioned: "If you buy Bitcoin, you're gambling, it has no unique value to attract people; it's essentially an alternative means of transferring funds."

"We don't own any Bitcoin, we don't lack any Bitcoin, and we will never have a position in it."

He emphasized: "Bitcoin might be rat poison squared."

"As far as cryptocurrencies are concerned, I am almost certain they will come to a bad ending. If I could buy a five-year put option on every cryptocurrency, I would be happy to do so, but I will never short a dime."

"I've had enough trouble with things I think I know something about, why should I take a long or short position in something I know nothing about? We don't need to know what cocoa beans are, whether it's cryptocurrencies or cocoa beans, we just need to focus on 8 to 10 stocks."

In May 2018, at the annual shareholder meeting of Berkshire Hathaway, Buffett explained: "Bitcoin is basically a gambling device; it itself does not create any value, it is not a creative asset that produces anything. It doesn't contribute to humanity like crop output or company production would, and many practical technologies should replace it."

"It has attracted a lot of people trying to create various transactions or other forms of scams. Those of less outstanding character saw an opportunity to suppress those trying to get rich because their neighbors got rich buying something they didn't understand, and the outcome will be very bad."

"It will sustain itself for a while, sometimes for a very long time, sometimes reaching astonishing figures. But they end badly, and cryptocurrencies will also have a bad ending."

"The rise in price does bring more buyers, people think they must participate, and it's better if they don't understand it. If you don't understand it, you will be more excited than when you do understand it."

He mentioned: "If you and I buy various cryptocurrencies, they won't multiply. There won't be a group of rabbits sitting in front of us. They will just sit there. I hope the next time I buy from you, you'll be more excited, then I'll be more excited and buy it from you, we can sit in the house, we can keep raising the price, but in the end. At that time, there's only one Bitcoin there, and now we have to find someone else, they're done."

In a February 2019 interview with CNBC in the United States, Buffett elaborated: "Bitcoin and other cryptocurrencies are essentially gambling tools, without any value. If you want to participate in gambling, at least go to a casino, where there are some statisticians operating, but we should be able to distinguish what is gambling and what is investment."

"It's clever, blockchain is important, but Bitcoin itself has no unique value, it doesn't produce anything. You can stare at it all day, and you won't get any Bitcoin or anything similar, it's basically an illusion."

"I'm really sorry that such things happen, because people hope that such things will change their lives."

In February 2020, Buffett pointed out: "Cryptocurrencies basically have no value, they don't produce anything. They don't reproduce, they can't send you a check, they can't do anything, you hope someone else will come and pay you more money later, but then the value of that person comes into question, going to zero."

"Bitcoin has been used to transfer a significant amount of funds illegally. Introducing Bitcoin was a reasonable move to reduce suitcases, because carrying money in suitcases from one country to another could be seen as Bitcoin's economic contribution to society."

"I don't have any Bitcoin, I don't own any cryptocurrencies, and I never will. I might create a Warren currency, maybe I can create one and say there will only be 21 million of them. You can have it after I die, but other than selling it to someone else you can't use it for anything."

In April 2023, Buffett stated: "Something like Bitcoin, it's a gambling token, it has no intrinsic value, but that doesn't stop people from playing roulette."

He reiterated: "The impulse to participate in what seems like easy money-making is a human instinct, this instinct has been released. People like the idea of getting rich quick, I don't blame them, that's human nature, once released, you can't put it back in the bottle."

In 2018, Bitcoin underwent a dramatic bear market adjustment, falling to a low of $3,130 for the year. In 2019, Bitcoin slowly oscillated and rebounded, reaching a high of $10,589 for the year. In 2020, under the impact of the COVID-19 pandemic, investors began to favor digital assets such as Bitcoin, reaching a high of $28,963 for the year. In November 2021, the Bitcoin bull market resumed, reaching a historic high of $69,045 in November.

In March 2022, when asked about cryptocurrencies at the annual shareholder meeting preview of Berkshire Hathaway, Buffett responded: "From a business or investment perspective, I don't think cryptocurrencies are good things. I'm glad not to be involved in them, it's just a piece of paper, and people think it has value."

In November 2022, Bitcoin experienced a crash, once plummeting to a low of $15,599. In the first half of 2023, Bitcoin experienced a slow rebound, touching near $31,000 in early May. On January 11, 2024, the U.S. approved a Bitcoin spot ETF, prompting a rapid rise in the coin price, surging to a peak of $73,776.

Overall, Buffett has repeatedly criticized Bitcoin and cryptocurrencies over the years in various occasions, considering them as gambling without intrinsic value, not to be regarded as an investment vehicle but as an alternative means of transferring funds. He warned investors not to be confused by speculative hype.

Although Buffett is not optimistic about Bitcoin, this does not mean that his Berkshire Hathaway shares the same view.

Berkshire Hathaway has a market value of nearly $900 billion, and Buffett has many experienced advisors assisting in managing his extensive investment portfolio. Evidently, whether it's Buffett or one of his advisors, someone has a soft spot for a stock, investing $1 billion in it. The performance of this stock is heavily influenced by cryptocurrency price fluctuations, including Bitcoin.

This public company is Brazil's digital bank, Nubank.

In 2013, under the name Nubank, it swept the Latin American banking industry, a region long dominated by a few powerful entities that exploited their market dominance to charge consumers high basic service fees.

Nubank was born as a digital-first bank, providing low-cost bank accounts, credit cards, and personal loans to any user with a smartphone or computer.

In 2014, Nubank had almost no customers, but subsequently, customer numbers grew each quarter, surpassing 90 million by 2023. Surprisingly, now more than half of Brazil's adults are Nubank customers.

After entering the cryptocurrency services sector, Nubank became known for its technology-driven solutions, supporting its mission to disrupt traditional banking operations. This move aims to democratize financial access.

In April 2024, Nubank introduced Bitcoin and Ethereum trading on its platform, and through the latest system, it now enables customers to fully own their digital assets by allowing transfers to personal wallets.

Nubank's move could change the crypto banking business in Latin America and other regions where financial inclusivity still faces challenges. By allowing transfers to self-hosted wallets, Nubank is addressing a major issue in the cryptocurrency community. It enables users to own and control digital assets without relying on third-party institutions. Self-hosting is a fundamental principle of the cryptocurrency ethos, emphasizing the security and autonomy of investment.

Buffett's support for Nubank adds a layer of credibility and trust to this initiative. Although Buffett has historically been skeptical about cryptocurrencies, his investment in Nubank can be seen as an indirect endorsement. It highlights his support for the bank's innovative financial services, including the integration of cryptocurrency transactions.

The ability to transfer Bitcoin to self-hosted wallets is not just a technical update; it represents a broader shift towards higher security and independence for cryptocurrency users.

Additionally, with Nubank's large customer base gaining more confidence in directly managing their cryptocurrency investments, this update could pave the way for increased adoption and use of Bitcoin. It also sets a precedent for other banks and financial institutions in Latin America and other regions, potentially leading to wider acceptance of cryptocurrencies and their integration into the mainstream financial system.

As of May 2, the closing stock price of Nu Holdings Ltd. in the U.S. was reported at $10.96, with a cumulative year-to-date increase of 32.53%.