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“If inflation increases, or even if it does not, and more companies decide to diversify a small part of their cash balances into bitcoin instead of money, then the current relative flow in bitcoin would become a torrent.”
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This is Bill Miller, founder of Miller Value Partners, in a letter to customers published on the company’s website on Tuesday, reaffirming his optimistic view of the world’s most popular digital currency.
Miller is one of several important Wall Street investors, including Stanley Druckenmiller and Paul Tudor Jones, who adopted bitcoin. Part of the excitement comes from increased adoption of digital currencies, including the announcement of PayPal Holdings Inc. PYPL,
last year, which would allow customers to buy cryptocurrency through their accounts and use cryptocurrency for merchant payments.
Opinion: Bitcoin is heading for a supply shortage – and this will continue to put pressure on prices
Bitcoin BTCUSD,
was trading at a record high of more than $ 35,000 on Wednesday after an increase in late 2020. The digital currency has risen more than 20% this week and has risen by almost 350% in the past 12 months, according to FactSet.
The Bitcoin rally comes with other assets perceived to be risky based on strong 2020 gains, with stocks rising solidly as Democrats seemed on the verge of tipping Georgia’s two seats in the U.S. Senate after Tuesday’s elections.
The Dow Jones Industrial DJIA,
The average shot up more than 600 points, or 2%, to an all-time high above 31,000, while the S&P 500 SPX,
gained 1.4% with the high-tech Nasdaq Composite COMP,
stayed behind with a gain of 0.5%.
Miller argued that bitcoin can increasingly be seen as an alternative to money, as the Federal Reserve follows a policy “whose goal is to make money investments lose money in real terms for the foreseeable future”.
Miller concluded the missive with a comment on the billionaire investor – and a skeptical skeptic of cryptocurrency – Warren Buffett’s description of bitcoin as “rat poison”.
Buffett “may be right. Bitcoin can be rat poison, and the rat can be money, ”said Miller.