Several billionaires turn to crypto for fear of fiat inflation
Former anti-crypto investors are increasingly turning to Bitcoin and its brothers as a hedge against fiat currency inflation concerns.
An example is the Hungarian-born billionaire Thomas Peterffy, who in a Bloomberg report from 1 January said that it would be justifiable to have 2-3% of one’s portfolio in cryptocurrencies in case fiat “goes to hell”. He is reportedly worth $ 25 billion.
Peterffy’s company, Interactive Brokers Group Inc., announced that it would offer crypto trading to its customers in mid-2020 following increased demand for the asset class. The company currently offers Bitcoin, Ethereum, Litecoin and Bitcoin Cash, but will expand this range by another 5-1[ads1]0 coins this month.
Peterffy, who himself has an undisclosed amount of crypto, said that it is possible that digital assets can reap “extraordinary returns” even if some can also go to zero according to Bloomberg. “I think it could go to zero, and I think it could go to a million dollars,” he added before saying “I have no idea.”
In early December, the billionaire predicted that Bitcoin could rise as high as $ 100,000 before the markets begin to retreat.
Related: Tom Peterffy believes that Bitcoin can crash can go to $ 100K before crashing
Bridgewater Associates founder Ray Dalio is another well-known billionaire who revealed that his portfolio included some Bitcoin and Ethereum last year. This revelation came just a few months after he questioned the properties of crypto as a store of value.
He has now changed this attitude and sees investing in cryptocurrencies as “alternative money” in a world where “cash is rubbish” with inflation eroding purchasing power.
In late December, Dalio commented that he was impressed with how crypto lasted, before stating “Cash, which most investors believe is the safest investment, is, I think, the worst investment.”
Billionaire hedge fund manager Paul Tudor Jones also bought Bitcoin last year, describing it as a hedge against inflation.
Pandemic-induced stimulation packages have caused economic turmoil across the globe, and the fallout from this could last for decades. In the United States, four-decade inflation is 6.8% high. This has resulted in an increase in the consumer price index (CPI) as the cost of groceries continues to increase.
The billionaires are already seeing the danger signs with fiat currencies and central bank manipulation, and they are increasingly turning to cryptocurrencies. The year 2022 may see more wealthy investors join their ranks if the trend continues.
