Was Warren Buffett right? 3 Reasons He Never Buys Bitcoin By Investing.com

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Investing.com – Today’s drop was so steep that it touched the 21,200 level. After a difficult year for cryptocurrencies, stocks and bonds, the market capitalization of the sector is less than a trillion dollars.

The losses of this major digital asset have accumulated to a loss of nearly 70% since its high in November, when it touched nearly $70,000. With the rapid and high growth reflected in the price of Bitcoin, the digital asset presented itself to investors as an option that could generate significant profits.

But Warren Buffett, the popular investor and CEO of Berkshire Hathaway (BRKa), has never tried to invest in Bitcoin, on the contrary, he has always claimed that he is not interested in it. According to Moneywise, these are the three main reasons the money man has always ruled it out:

  1. It’s unproductive value: According to the money expert, the value of Bitcoin comes from optimism that someone else will be willing to pay more for it in the future than they are paying today. Buffett prefers the money that comes from production. “It has no unique value,” he said.

  2. It is not a permanent exchange medium or store of value. According to Buffett’s statements, crypto cannot be considered money: “It does not pass the currency test. It is not a permanent medium of exchange, it is not a store of value,” the billionaire said. At the moment it is just a tradable asset.

  3. He admits that he does not understand it. Buffett has always been investing in what he understands how to do and how to make money. He stresses that investors can make the mistake of getting “excited” about what they don’t understand, so he prefers to be careful: “If you don’t get it, you’ll be more excited than if you did. You look at something and say, ‘That’s magic’.”

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