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Warren Buffett has frequently voiced his disapproval of digital currencies, particularly targeting Bitcoin. During a Berkshire Hathaway shareholder meeting in 2018, he referred to Bitcoin as “probably rat poison squared.” According to his analysis, he believes there is no practical value in this asset class, leading him to caution investors about the potential for significant losses. Charlie Munger, then vice chairman of Berkshire, echoed Buffett's sentiment, describing cryptocurrency trading as “just dementia.”
Team Buffett advised potential investors to avoid purchasing digital currencies. His 2018 interview revealed his belief that most cryptos would prove damaging to stakeholders.
He stated clearly that he would never engage in short selling crypto assets, yet admitted he would purchase put options for the entire cryptocurrency market over the next five years if possible.
Despite Buffett's persistent opposition to cryptocurrencies, Berkshire Hathaway has invested in companies with connections to the crypto space. During 2021, Nu Holdings obtained a $750 million investment from the firm creating a digital banking platform in Brazil. Users interact with Nu Holdings to oversee crypto assets, acquire digital currencies, and perform crypto market operations.
Berkshire Hathaway showed interest in digital finance through its modest Nu Holdings investment. Although Buffett shows no interest in crypto, his companies remain active in the field through investments.
Through Berkshire's investments, the company maintains ownership of more than 430,000 shares within Jefferies Financial Group alongside Nu Holdings. Jefferies Financial Group holds an essential position by investing in the iShares Bitcoin Trust ETF, the world's most prominent spot Bitcoin exchange-traded fund. Through these investments, the company demonstrates moderate engagement with fintech and digital assets.
Berkshire has invested in companies that work with cryptocurrency, but Buffett continues to maintain his stance against crypto assets. At his 2022 shareholder meeting, he declared he would refuse to purchase all existing Bitcoin, even at $25. According to Buffett, Bitcoin produces no work output and serves no purpose.
Berkshire's investment choices demonstrate business-focused decision-making instead of ideological changes. Throughout the financial sector's transformation, Berkshire emphasizes value creation and long-term expansion.
