“
‘If inflation picks up, or even if it doesn’t, and more companies decide to diversify some small portion of their cash balances into bitcoin instead of cash, then the current relative trickle into bitcoin would become a torrent.’
”
That’s Bill Miller, founder of Miller Value Partners, in a letter to clients published on the firm’s website Tuesday, reaffirming his bullish outlook on the world’s most popular digital currency.
Miller is one of several high-profile Wall Street investors, including Stanley Druckenmiller and Paul Tudor Jones, to 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 buy cryptocurrency through their accounts and use cryptocurrency for merchant payments.
Opinion: Bitcoin is headed for a supply shortage — and that will keep pushing up prices
Bitcoin
BTCUSD,
was trading at a record above $35,000 on Wednesday after a late 2020 surge. The digital currency has rallied more than 20% this week and is up nearly 350% over the last 12 months, according to FactSet.
Bitcoin’s charge higher comes as other assets perceived as risky built on strong 2020 gains, with stocks moving solidly higher as Democrats appeared on the brink of flipping both Georgia seats in the U.S. Senate following Tuesday’s runoff elections.
The Dow Jones Industrial
DJIA,
Average soared over 600 points, or 2%, to an all-time high above 31,000, while the S&P 500
SPX,
gained 1.4% as the tech heavy Nasdaq Composite
COMP,
lagged behind with a gain of 0.5%.
Miller argued that bitcoin could increasingly become seen as an alternative to cash as the Federal Reserve pursues policy “whose objective is to have investments in cash lose money in real terms for the foreseeable future.”
Miller concluded the missive with a riff on billionaire investor — and noted cryptocurrency skeptic — Warren Buffett’s description of bitcoin as “rat poison.”
Buffett “may well be right. Bitcoin could be rat poison, and the rat could be cash,” Miller said.
