In 2021, the number of billionaires that bought cryptocurrency went through the roof. As fiat inflation fears grow, that trend could continue into 2022. Even investors who were anti-crypto before turned to Bitcoin and other assets as a hedge against fiat currency inflation.
Peterffy advocates 2-3% of portfolio in crypto
Bloomberg reported that Hungarian-born billionaire Thomas Peterffy said it was wise to have 2-3% of one’s portfolio in crypto assets. He added that fiat currencies might “go to hell”. Peterffy’s wealth is said to amount to $25 billion.
His company Interactive Brokers Group Inc. launched crypto trading in the middle of 2020 after clients’ demand for the asset class skyrocketed. At the moment, IB Group offers Bitcoin, Ethereum, Litecoin, and Bitcoin Cash. In January this year, they will add 5-10 more coins to the roster.
While Peterffy conceded that some coins could go to zero, he stated that digital assets could reap “extraordinary returns”. Peterffy’s crypto holdings remain undisclosed. He told Bloomberg in an interview on January 1:
I think it can go to zero, and I think it can go to a million dollars. I have no idea.
At the beginning of last month, he predicted that Bitcoin could hit an all-time high of $100,000 before markets turn bearish again.
Dalio: Cash is trash
Ray Dalio, the billionaire founder of Bridgewater Associates, shared that his portfolio contained some Bitcoin and Ethereum in 2021. A few months earlier, he had questioned crypto’s properties as a store of value.
Now, he’s apparently changed his mind, viewing crypto asset investments as alt-money in a situation where “cash is trash’’ and high inflation is reducing buying power. At the end of last month, he commented:
Cash, which most investors think is the safest investment is, I think, the worst investment.
Another voice in favor of crypto as a store of value has been that of billionaire hedge fund manager Paul Tudor Jones, who also bought Bitcoin in 2021.
Govt stimulus packages wreak economic havoc
Coronavirus-induced stimulus packages have resulted in economic havoc worldwide. The repercussions could last decades. The US inflation rate hit a record high of almost 7%, leading to a surge in the Consumer Price Index (CPI) as the prices of high turnover goods continue to rise.
2022 to see more billionaires investing in crypto
2022 could see other rich investors joining the ranks of Jones, Peterffy, and Dalio if the trend continues.
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