Those were once the words of Warren Buffett, the famous investor called the “sage of Omaha” for knowing things before the rest of the market. Now his money is saying otherwise.
Specifically, his company Berkshire Hathaway has bought $1 billion worth of stock in a digital bank that focuses on crypto.
Berkshire Hathaway made its crypto investment public with a SEC filing earlier this week. It revealed that Buffett’s company had purchased $1 billion in shares of Nubank, a digital bank based in Brazil, and the largest of its kind in Latin America.
Nubank is a so-called neobank, a type of bank that operates differently from the traditional banking system by not relying exclusively on physical locations, and instead focuses primarily on digital services. The digital bank’s investment unit, NuInvest, allows users to put money in a Bitcoin exchange-traded fund (ETF)—tapping a financial space that Berkshire’s leaders have shown little love for.
Berkshire’s chairman and CEO has not refrained in the past from calling cryptocurrency “rat poison” and an unproductive asset that “has no unique value at all.”
Charlie Munger, Buffett’s longtime partner and vice chairman of Berkshire Hathaway, has also hardly been one to shy away from voicing his strong opinions on cryptocurrency. Munger recently stated that he wished cryptocurrency had “never been invented,” and he has even indicated that he would not want any crypto trader marrying into his family.
Munger has a particular distaste for Bitcoin, the most popularly traded cryptocurrency, once calling it “disgusting and contrary to the interests of civilization.” Munger has supported China’s decision to ban Bitcoin trading in the country and has called on the U.S. to take similar measures.
“The Chinese made the correct decision, which is just to simply ban them,” he once said.
But even though its owners have expressed their personal disdain for cryptocurrencies and the crypto market, Berkshire Hathaway’s latest investment in Nubank is not the first time the conglomerate has dabbled in this market.
Berkshire already bought a $500 million stake in Nubank last summer, months before the company went public in December 2021. At the time, Nubank announced that this had been the largest single investment the fintech bank had ever received.
As Berkshire was upping its investments into the crypto sphere last year, the company also dropped some of its other, more traditional financial assets. In the same SEC filing that showed the $1 billion investment in Nubank, Berkshire revealed that it had dropped over $3 billion in its shares of Visa and Mastercard.
While Buffett and Munger may have a personal distaste for cryptocurrency, the superstar investment pair may be seeing an entirely different kind of opportunity in digital financial service providers like Nubank.
There is huge competition among up-and-coming digital banks in Latin America, where a large portion of the population feels underserved by the traditional banking and financial system. Companies like Nubank are looking to tap into a massive potential consumer market of people largely dissatisfied with the existing system.
“There is so much opportunity in the [Latin America] region. The combination of a great population, horrible customer experiences, and very high fees, it is unmatched,” Nubank cofounder Cristina Junqueira told Fortune last June. “Worldwide there is no place that is better suited in terms of having a great opportunity for fintech companies to tackle.”
FAQs
If you had invested $1,000 into bitcoin five years ago, the investment would have grown by 1,352% and be worth around $14,524 as of Feb. 14. If you had bought $1,000 worth of bitcoin 10 years ago, it would have grown by 7,644% and be worth around $77,443 as of Feb. 14.
What cryptocurrency did Warren Buffett invest in? ›
(NYSE:NU). Although Buffett has been openly critical of Bitcoin, referring to it as “rat poison,” Berkshire Hathaway has reaped significant gains via its stake in Nu Holdings. Initially investing $500 million in a Series G funding round and an additional $250 million later, Berkshire's involvement has paid off.
Why doesn t Warren Buffett invest in crypto? ›
Perhaps the most famous value investor of all time, Warren Buffett is strongly against Bitcoin and other cryptocurrencies, saying, "You can't value Bitcoin because it's not a value-producing asset." Buffett and his holding company Berkshire Hathaway Inc. have been well-known for their investments in stable and ...
What does Warren Buffett think of Bitcoin now? ›
According to Benzinga, Buffett believes that cryptocurrencies aren't a viable or valuable investment.
What will $100 of Bitcoin be worth in 2030? ›
If Wood is correct and Bitcoin reaches $3.8 million, a $100 investment in Bitcoin today would be worth $5,510 in 2030. This translates to a compounded annual growth rate (CAGR) of over 95%. While the prediction is bullish, Bitcoin's 14-year CAGR is well over 220%, so it is not entirely out of the question.
How much will $500 of Bitcoin be worth in 5 years? ›
If I invest $500 in Bitcoin at the start of 2022, how much money will I expect in the next 5 years? I see Bitcoin hovering around $90k by the mid of 2022, if not the entire market is collapsed by that time. In 5 years Bitcoin can easily reach $150k-$250k.
What crypto is Elon Musk invested in? ›
Musk's fascination with the world of crypto has been on full display in recent years, and he's not shy about throwing his considerable influence behind his preferred digital coin: Dogecoin.
What is Warren Buffett's biggest investment? ›
Apple is Berkshire's largest public stock holding by far. Berkshire's $183 billion Apple stake is more than four times larger than its second-largest holding. Buffett first bought Apple shares in the first quarter of 2016. AAPL's price is up more than 800% since the beginning of 2016.
Does Bill Gates own Bitcoin? ›
I cover the world's richest. This article is more than 2 years old. Microsoft cofounder Bill Gates isn't a fan of cryptocurrency.
Can Bitcoin go to zero? ›
A reasonable assumption that Bitcoin could hypothetically reach the null state of it's value is worth the thought. Even-though such an event is very less likely to take place, there are some factors that could theoretically lead to Bitcoin price crashing to zero.
As Benzinga previously reported, Buffett and Berkshire Hathaway are shareholders in Nu Holdings (NYSE:NU), a Latin American digital bank. Nu Holdings is a crypto-friendly bank and has launched several cryptocurrency products along with allocating a portion of its cash to Bitcoin.
Which Bitcoin billionaire is in trouble? ›
The ruling cements the downfall of the former billionaire, who emerged as a high profile champion of crypto before his firm's dramatic collapse in 2022. He was found to have stolen billions from customers ahead of the failure. Bankman-Fried's legal team will appeal against his conviction.
Are the wealthy buying Bitcoin? ›
Any talk of billionaires buying Bitcoin has to start with Michael Saylor, executive chairman and co-founder of MicroStrategy (MSTR 2.81%). The billionaire started aggressively buying Bitcoin back in mid-2020, and has been continually ramping up his company's Bitcoin holdings since then.
How much is $100 in Bitcoin 5 years ago? ›
If you had invested $100 in Bitcoin five years ago, you would have bought Bitcoin at the average price of $6,000 (price in mid-2018). With $100, you would have approximately 0.0167 BTC. Fast forward to today, with Bitcoin's current value at around $30,000 (June 2024), your investment would be worth approximately $500.
Is investing $1000 in Bitcoin worth it? ›
If we go by Wood's predictions of Bitcoin hitting $1 million in 2030, that would represent a 1,288% price increase from today's price. In turn, $1,000 in Bitcoin bought today would produce a return of $12,880 return in six years.
What is the return of Bitcoin for 5 years? ›
Average returns
| Period | Average annualised return | Total return |
|---|
| Last year | 105.7% | 105.7% |
| Last 5 years | 42.3% | 482.5% |
| Last 10 years | 58.1% | 9,676.2% |
But it recovered and hit $998.62 at the start of 2017, meaning that an investor who bought $1,000 worth would have bought slightly more than an entire Bitcoin. Today, that initial $1,000 investment would be worth $22,800.
