One more highly successful investor of the world thinks that Bitcoin and cryptocurrencies are bubble. Nevertheless, he’s still going to start trading them. And his name is George Soros.
Soros, who controls Soros Fund Management and has a personal networth of $8 billion, had said in January that “cryptocurrencies are a bubble”. But now there’re reports that his family office is soon going to start trading them anyway. He won’t be trading them personally though – Adam Fisher, who oversees macro investing operations of his family office – will be the guy playing with this ‘bubble’ for him.
The news was first broken by Bloomberg, and according to their report Adam got approval to start trading cryptocurrencies sometime in last few months. This is very interesting because during this same period Soros had made public his distaste for cryptocurrencies. He had called Bitcoin a “bubble” in front of whole world’s business and political community at World Economic Forum. However, his comments were different from others in traditional finance community as he predicted that Bitcoin may not have as sharp of a break as most asset bubbles do.
Given below is what he had said at World Economic Forum in Davos:
“Normally when you have a parabolic curve, eventually it has a very sharp break. But in this case, as long as you have dictatorships on the rise you will have a different ending, because the rulers in those countries will turn to Bitcoin to build a nest egg abroad.”
This was said on January 25. So the approval to Fisher might’ve been given sometime later. Fisher, however, is yet to make a move in that direction as he is weighing his options.
Soros has also been betting on cryptocurrencies in an indirect manner from quite sometime. In case you don’t know, his family office acquired a large stake in e-retailer Overstock.com during the last quarter of 2017. The stake purchase made Soros 3rd largest shareholder in Overstock. How is this linked to betting on cryptocurrencies, you may ask. Well, because just a few months ago in August 2017 Overstock started accepting cryptocurrencies for payments. It was first major retailer to do so.
Last month it was heard that Billionaire Hedge Fund Manager Alan Howard has also started trading cryptocurrencies from a significant sum of his personal wealth. It was also heard that he has hired staff to help him in this venture.
Institutional investors have traditionally been wary of playing in crypto markets, except for a few of them (i.e. BlackRock, SBI and Mitsubishi of Japan). Analysts suggest that these investors may also jump on to cryptocurrency bandwagon soon, but that hasn’t happened yet. However, now when folks like Soros and Howard are getting involved, things may change soon.