Benzinga - 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 profitable companies.
Buffett believes in investments that create value, instead of relying on investor sentiment. "If you buy something like Bitcoin or some cryptocurrency, you don’t really have anything that has produced anything. You’re just hoping the next guy pays more."
This strategy has been profitable for decades, allowing Berkshire Hathaway to become one of the largest and most profitable companies in the world. Investors around the globe look to Buffett and his companies for investment advice and recommendations.
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However, Buffett’s strong anti-crypto stance may change after reviewing the firm's performance in 2023. The top performing investment in 2023 for Berkshire Hathaway was a Brazilian fintech Nu Holdings Ltd.. The company owns Nubank, a neobank that offers credit cards and banking as well as crypto trading for users. It offers 15 different tokens, as well as its own utility token called Nucoin.
The company went public in December 2021 but had received backing from Buffett and Berkshire during series G funding when Berkshire invested $500 million in the company. Buffett later increased his stake by another $500 million for a total of $1 billion invested in early 2022.
The investment has paid extremely well, as Brazil has had a very open and accepting stance on crypto. In 2023, the price of Nu Holdings appreciated by 93%. These huge gains made Nu Holdings the most profitable investment in Berkshire Hathaway's portfolio for 2023. This investment is especially surprising given the strong performance of stocks in other sectors, such as technology.
Buffett has not sold his investment in Nu Holdings, potentially implying that he is bullish on the stock for the months or years to come.
Considering Buffett's hesitancy to invest in crypto directly, this could be an eye-opener for the legendary investor. As the company looks back on 2023, the strong performance of its crypto-related investment could cause it to look into other crypto stocks or even cryptocurrencies themselves.
While cryptocurrency and digital tokens don't adhere to Buffett's main investment theses, it is impossible to argue with the gains they can provide investors. For example, Bitcoin appreciated more than 150% in 2023, beating every investment in Buffett's portfolio.
As crypto becomes more pervasive and part of mainstream investing, it will be interesting to see whether Buffett and Berkshire will give in and further their investments into crypto stocks or even major tokens like Bitcoin.
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