Don't confuse speculation with investment, billionaire CEO warns.
Ramping up to Berkshire Hathaway's annual shareholder meeting, Chairman and CEO Warren Buffett — currently third-richest man on the planet — shared his thoughts on Bitcoin with Yahoo Finance.
As it turns out, the “Oracle of Omaha,” whose word is considered sacrosanct among investors worldwide, believes that buying Bitcoin is speculation rather than direct investment.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Speaking on the subject of buying cryptocurrency, Buffett explained:
You aren’t investing when you do that. You’re speculating. There’s nothing wrong with it. If you wanna gamble somebody else will come along and pay more money tomorrow, that’s one kind of game. That is not investing.
This diverges from “investment” in that, with investing, “you look at the investment itself to deliver the return to you,” rather than “hoping the next guy pays more” in the game of cryptocurrency gambling.
While this commentary is not specifically negative — Buffett is merely making a semantic differentiation — he has expressed skepticism about Bitcoin and cryptocurrency multiple times in the past.
In 2014, he urged buyers to stay away, dubbing it a “mirage.” Four years later, when the price had leapt over 23x since the 2014 comments, Buffett doubled down on this viewpoint, claiming of cryptocurrencies: “I can say almost with certainty that they will come to a bad ending.”
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