Fiat Currency Inflation, Making Many Billionaires Invest Funds In Bitcoin And The Like

Billionaires are now looking to invest in Bitcoin and the like. (photo credit: pixabay)

JAKARTA - Concerns about fiat currency inflation have made some investors who have been known as anti-crypto, now start to look at investing in Bitcoin and the like.

One example is Hungarian-born billionaire Thomas Peterffy, who, in a January 1 Bloomberg report, said that it would be wise to have 2-3% of the portfolio in crypto assets in case fiat “goes to hell”. He is reported to have assets worth 25 billion US dollars (Rp356.5 trillion).

Peterffy's company, Interactive Brokers Group Inc., announced that it will offer crypto trading to its clients in mid-2020 following increased demand for this asset class. The company currently offers Bitcoin, Ethereum, Litecoin, and Bitcoin Cash, but will expand that selection with another 5-10 coins within this month.

Peterffy, who holds an undisclosed amount of crypto, said that it is possible the digital asset could reap “tremendous returns” even if some coins could also go to zero according to Bloomberg. "I think it could be zero, and I think it could reach a million dollars. I don't know," he was quoted as saying by Cointelegraph.

In early December, the billionaire estimated that Bitcoin could soar as high as $100,000 before the market started to pull back.

Bridgewater Associates founder Ray Dalio is another well-known billionaire who revealed his portfolio contains multiple Bitcoins and Ethereums last year. The revelations come just months after he questioned crypto's properties as a store of value.

He has now changed that stance and views crypto asset investing as “alternative money” in a world where “cash is trash” with inflation eroding purchasing power.

In late December, Dalio commented that he was impressed with how crypto is holding up, before stating “Cash, which most investors think is the safest investment, in my opinion, is the worst investment,” Dalio said, quoted by Cointelegraph.

Billionaire hedge fund manager Paul Tudor Jones, also bought Bitcoin last year, labeling the move a hedge against inflation.

The pandemic-induced stimulus package has caused economic turmoil around the world, the effects of which could last for decades. In the United States, inflation is at a 4-decade high of 6.8%. This has an impact on the soaring Consumer Price Index (CPI) in line with the increase in the price of basic daily needs.

Billionaires are already seeing the red flags with fiat currency and central bank manipulation, and they are increasingly turning to crypto assets. The year 2022 could see more wealthy investors join their ranks if the trend continues.