Veteran investor Bill Miller flips Warren Buffett’s bitcoin snub to argue that crypto is beating money | Currency News | Financial and business news
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- Value investor Bill Miller praised Bitcoin in a market letter on Thursday.
- The head of Miller Value Partners and former head of Legg Mason cited Warren Buffett’s scathing criticism of the cryptocurrency to underscore the risk of inflation for those who hold dollars.
- “Warren Buffett famously called Bitcoin ‘rat poison,'” Miller said. “Maybe he’s right. Bitcoin could be rat poison and the rat could be cash.”
- Buffett has repeatedly highlighted inflation as a disadvantage of holding cash and stated that he prefers owning productive assets such as companies.
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Veteran investor Bill Miller trumpeted in a blog post this week about the rich prospects of Bitcoin by repurposing Warren Buffett’s rejection of the cryptocurrency as a “rat poison” to underscore his own confidence in it.
The boss of Miller Value Partners and former investment boss of Legg Mason pointed out that Bitcoin has outperformed all major asset classes in recent years. The digital coin currently has a larger market cap than Buffett’s Berkshire Hathaway conglomerate, although it is not yet widely used, he continued.
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Miller added that the Federal Reserve is threatening to undermine the value of the dollar with rock-bottom interest rates and continued injections of liquidity into the US economy. Pressure on the greenback has led companies like Square and MicroStrategy to switch some of their cash into bitcoin to lessen the impact of the devaluation, he said.
Bitcoin is “best thought of as digital gold,” but has several advantages over port metal, Miller continued. As more companies swap cash for crypto, “the current relative trickle in Bitcoin would turn into a stream,” he added.
“Warren Buffett famously called Bitcoin ‘rat poison,'” Miller said. “Maybe he’s right. Bitcoin could be rat poison and the rat could be cash.”
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It’s worth noting that Buffett highlighted inflation as the inevitable disadvantage of holding currency-denominated assets like cash or bonds. The Berkshire boss has also criticized “stores of value” like gold for not producing anything and only increasing in value if someone is willing to pay more for them in the future.
Instead, Buffett prefers to own productive assets like farms and businesses.
“Whether the currency is based on gold, clam, shark’s teeth, or a piece of paper a century from now (like it is today), people will be willing to trade a few minutes of their daily work for a Coca-Cola or a few See’s peanut brittle,” he said 2011 in his letter to shareholders.