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“If inflation picks up, if not even, and more companies decide to diversify a small portion of their cash balances into bitcoin rather than cash, then the current relative drip into bitcoin would become a torrent.”
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That’s Bill Miller, founder of Miller Value Partners, in a letter to customers published on the company’s website Tuesday, confirming his optimistic view of the world’s most popular digital currency.
Miller is one of the many leading Wall Street investors, including Stanley Druckenmiller and Paul Tudor Jones, who have embraced bitcoin. Part of the enthusiasm comes from the increased adoption of digital currencies, including the announcement by PayPal Holdings Inc. PYPL,
last year that it would allow customers to purchase cryptocurrency through their accounts and use cryptocurrency for payments to merchants.
Opinion: Bitcoin is headed for a stock shortage – and that will continue to drive prices up
Bitcoin BTCUSD,
traded a record high of more than $ 35,000 on Wednesday after rising in late 2020. Digital currency is up more than 20% this week and is up nearly 350% in the past 12 months, according to FactSet.
Bitcoin’s cost is getting higher as other assets considered risky build on strong gains in 2020, with stocks surging higher as Democrats were on the verge of flipping both Georgia seats in the U.S. Senate after the second Tuesday’s elections.
The Dow Jones Industrial DJIA,
The average rose more than 600 points, or 2%, to a record high of more than 31,000, while the S&P 500 SPX,
1.4% recovered as the tech-heavy Nasdaq Composite COMP,
lagged behind with a gain of 0.5%.
Miller argued that bitcoin could increasingly be viewed as an alternative to cash, as the Federal Reserve pursues a policy “the goal of which is to make cash investments in real terms lose money in the near future.”
Miller closed the message with a riff at the billionaire investor – noting the cryptocurrency skeptic – Warren Buffett’s description of bitcoin as “ rat poison. ”
Buffett “may be right. Bitcoin could be rat poison, and the rat could be cash, ”said Miller.