Warren Buffett doubled down on his criticism of bitcoin Wednesday during an interview with CNBC, where he said he’s almost certain the cryptocurrency craze “will end badly” and that the current runup in value will be fleeting.
But paradoxically, he also admitted that he “doesn’t know anything” about digital currencies after saying he would eagerly buy five-year puts on “every one of the cryptocurrencies.”
“In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending,” said Buffett, the chairman and CEO of Berkshire Hathaway.
“When it happens or how or anything else I don’t know,” he added in an interview on CNBC’s “Squawk Box” from Omaha, Nebraska.
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“But I know this: If I could buy a five year put on every one of the cryptocurrencies, I’d be glad to do it but I would never short a dime’s worth.”
While explaining why he wouldn’t take a short position, he said he “gets into enough trouble with things I know something about…”
“I get into enough trouble with things I think I know something about,” Buffett said. “Why in the world should I take a long or short position in something I don’t know anything about.”
His comments notably come a day after JP Morgan Chase & Co. CEO Jamie Dimon said he “regrets calling bitcoin a fraud.” Dimon last fall famously compared bitcoin to the Dutch tulip mania and threatened to fire any JPM trader caught buying or trading digital currencies.
Buffett added that his remarks are purely hypothetical. “We’ll never own a position in them,” he said.
Still, Buffett admitting that he’d be a seller even though he “doesn’t know anything about” bitcoin – he even claimed he wouldn’t be able to explain bitcoin to a classroom of young students – should signal that readers should take his comments with a grain of salt.
After all, by his own admission, Buffett doesn’t know what he’s talking about.
Buffet’s old as dirt and isn’t really up on current technology.
But I think he is right on this one.
Explain how bitcoin differs from the $ which is created out of thin air.
You would need a gun to get my bag of fiat. You need a modem to steal bitcoin.
Is what he “would” do what he is doing?
If not, why?
Crypto’s = just another fiat currency with nothing other than promises to back it up.
Buffet’s bet would be a wise one. It would obviously depend on the price of the option, but I would generally take it. There will be a few winners, and a bunch of losers as cryptos consolidate. By buying puts, he gets to just lose his premiums on the winners and collect big dollars as the rest of the pack heads towards near-zero. He also said he would not short, wise, because the losses on the short of the ‘winner’ could easily outweigh the gains of shorting all the losing one.
Leaving the merits of his arguments aside, this is prophetic. It is prophetic not because Buffet is such a wise investor; it is because he is one of the best connected people in the world – connected to people that will guarantee his investments.
This is a big fat warning flag indicating that anyone in cryptocurrencies should exit and exit now. Buffet is making these statements because he has already made the investment (secretly or otherwise), and his buddies in government are working to ensure that it is a winning bet.
Bitcoin futures?
https://vrlps.co/a?pt=24egHeF-mYgN9sCzFHAbpvZzKrw&referralCode=SJsxp3mEf&refSource=copy
I read someplace yesterday and I am paraphrasing:
The cryptocurrency bourse is like a commode where you buy and the price rises similar to the action of the commode filling. Someone then flushes and all hell breaks loose and the action starts all over again…….