A Legendary Hedge Fund Billionaire Just Flipped To Bitcoin—Calling It ‘Better’ Than Gold
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Bitcoin’s reputation as digital gold has grown this year, with a number of high-profile investors naming it as an emerging inflation hedge.
The bitcoin price has more than doubled so far through 2020, climbing to almost $16,000 per bitcoin this week and sparking celebration among long-suffering bitcoin bulls.
Now, after Wall Street legend Bill Miller said he “strongly” recommends bitcoin last week, billionaire U.S. investor Stanley Druckenmiller has revealed he now owns some bitcoin—saying he’s “warmed up to” the cryptocurrency as a store of value.
Stanley Druckenmiller, a hedge fund billionaire, made his pro-bitcoin comments on an appearance on … [+] CNBC.
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“Bitcoin could be an asset class that has a lot of attraction as a store of value to both millennials and the new West Coast money and, as you know, they got a lot of it,” Druckenmiller, who, along with George Soros, famously bet against the British pound in 1992 and made massive profits, told CNBC this week. “It’s been around for 13 years and with each passing day it picks up more of its stabilization as a brand.”
Druckenmiller, after made headlines last week for his bearish views on the U.S. dollar, said he expects his bitcoin bet to “work better” than gold, though he holds a gold position that is “many, many more times” larger than his current bitcoin holding.
The gold price is currently just under its all-time high of around $2,000 an ounce set earlier this year, adding around 30% over the last 12 months and benefiting from many of the same trends that have lifted bitcoin through 2020—worries about the coronavirus pandemic, lower-for-longer interest rates, and inflation fears.
“Frankly, if the gold bet works the bitcoin bet will probably work better because it’s thinner, more illiquid and has a lot more beta to it,” said Druckenmiller, reversing comments he made in 2018 when said he “didn’t want to own bitcoin.”
Druckenmiller, who shut down his $12 billion hedge fund Duquesne Capital Management in 2010 and now manages his money through a family office, also said that inflation is likely to rise over the next five or six years due to the Federal Reserve’s massive stimulative measures put in place to offset the economic damage wrought by the pandemic.
The bitcoin price has added around 80% over the last 12 months–climbing around three-fold since the … [+] coronavirus crash in March sent bitcoin to under $4,000.
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Alongside a raft of high-profile investors turning to bitcoin this year, the bitcoin and cryptocurrency community has also been celebrating a number of other significant developments.
Last month, payments giant PayPal
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said it plans to allow its 346 million users to buy and spend bitcoin along with a handful of other major cryptocurrencies, while payments company Square
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, led by Twitter
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chief executive and outspoken bitcoin advocate Jack Dorsey, said it has added $50 million worth of bitcoin to its corporate accounts.
