Bitcoin is insurance against financial disaster. The opinion of a billionaire from Miller Value Partners
Bill Miller is a billionaire founder and chief investment officer of Miller Value Partners. The day before, he said that he considers Bitcoin “an insurance policy against financial disaster.” These words were voiced by Miller on the air of a recent episode of the Richer, Wiser, Happier podcast. In his opinion, crypto can become a very important tool for those who, for whatever reason, did not have access or were deprived of access to important services in the banking sector. Let's talk about the situation in more detail.
Note that this is not the first time the billionaire has commented on the topic of cryptocurrencies, and this happens quite often. For example, the last time this happened was last week. Then Miller noted that he had invested half of his investment portfolio in BTC, but at the same time he was not at all worried about the current drawdown.
According to him, earlier he found coins in the niche and not like that. Accordingly, it makes no sense to panic because of the current situation, because earlier the coin market collapsed even more, but at the same time both reached former highs and set new records.
As an example for his point of view, the billionaire recalled the withdrawal of US troops from Afghanistan in August 2021. This event led to the rapid seizure of power in the country by the Taliban and huge problems in the economy. Here is his remark, in which the expert mentions this event.
When the US withdrew its troops from Afghanistan, Western Union stopped sending or accepting money transfers from there. If you, for example, used your bitcoins in such a situation, everything would be fine. Your coins simply exist. You can send them to anyone in the world as long as you have a phone.
In other words, digital decentralized assets are really able to save people from various problems. This is especially true of today's current problems with the economy, which are faced by residents of many countries.
According to Miller, examples of how cryptocurrencies can function as "insurance" do not necessarily have to deal with such force majeure circumstances. Another telling example is the state of the crypto market during the COVID-19 pandemic and the sharp reaction of the US Federal Reserve System (Fed) to combat the economic consequences of the spread of the virus. The expert continues.
When the Fed stepped in and started squeezing the money supply and essentially bailing out mortgage rates, Bitcoin functioned perfectly. No one attacked the cryptocurrency, the system functioned without the Fed and without any additional intervention. Everyone got their bitcoins, the price corrected, and then, when crypto enthusiasts realized the rise in inflation, the value of the cryptocurrency skyrocketed. It's an insurance policy against financial disaster.
In other words, the fundamental advantages of Bitcoin in the form of a limited maximum supply of cryptocurrency and a fixed inflation rate attract a huge number of people who are not satisfied with the situation in the global economy. Note that this is also true for other popular cryptocurrencies. For example, in the Avalanche and Ethereum networks, native tokens are burned during transactions, which in one way or another reduces the amount of coins in circulation.
According to Cointelegraph sources , Miller also touched on the topic of Bitcoin's "uselessness", which was recently raised by another well-known investor, Warren Buffett. He previously stated that he “would not even buy all the bitcoins in the world” if they were offered to him for just $25. Here's what Miller thinks about it.
Buffett said that Bitcoin is an asset that produces nothing and therefore has no value. Fair enough. If the only thing you think you can value are productive assets, then no one is forcing you to buy Bitcoin, right? So ignore Buffett's words.
Miller is known for managing an investment portfolio that consistently outperformed the S&P 500 stock index for 15 consecutive years from 1991 to 2005. He is also known for his support of Bitcoin, with an investor investing half of his liquidity in crypto in January.
Asked by the podcast host if he still holds that position, the billionaire confirmed that about 40-50 percent of his money is in Amazon stock, and his stake in bitcoin is “about the same.” In addition, more than 80 percent of Miller's capital is distributed between these two assets.
We believe that Bitcoin and other cryptocurrencies are really able to save people in the event of global problems in the economy - at least they will continue to work and perform their functions even in the event of a default and bank blocking. However, at the same time, they are volatile, that is, they are able to seriously lose their own value. This means that users need to take this feature into account and not forget about stablecoins for a rainy day.
Look for even more interesting things in our crypto chat of millionaires . There we will talk about other topics related to the blockchain and decentralization industry.
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