There has been a lot of talk about Warren Buffet and crypto and I wanted to clear up some misconception on both side of the arguments. There are post implying that Berkshire and thus to an extent Buffet is now interested in Bitcoin and the other extreme that they in no way invested anything related to it.
Anyways, here are the breakdown. You can judge for yourself.
1. Berkshire is not just Warren Buffet. In fact many of the smaller deals and daily routines are run by his younger predecessor. Even the famous apple deal is a bit iffy if he was even involved in the beginning; some think it could be his younger investment deputies — Todd Combs and Tedd Weschler and others.
2. Berkshire Hathaway purchased about $1 billion worth of shares in Activision Blizzard in the fourth quarter, according to a regulatory filing, jumping in before Microsoft agreed to buy the video game publisher for $68.7 billion. Whether or not they know before hand is up to you to judge.
3. ActiveVision is a gaming company involved in online gaming and VR and has thus been grouped as “metaverse” and thus crypto. Some speculate why microsoft had bought them but no one knows for sure.
4. Berkshire Hathaway, the company led by CEO Warren Buffett, has invested $500 million in a pro-bitcoin digital bank. Nubank which is a fintech but importantly does not deal in bitcoin per se but is “pro-bitcoin” whatever that means.
5. Charlie Munger who is the right hand man of Buffet has been quote to say that Crypto traders ‘want to get rich quick’ without doing ‘anything. He is adamantly against crypto.
6. To be clear, as smart as he is, Charlie is not infallible: his most recent mistake with alibaba doubling his stake in Alibaba first in 2021 Q3 and doubled it again in 2021 Q4. Alibaba is a chinese own company that has drop by more than 50% in less than a year.
7. Berkshire did sold off $1.8bn of his Visa shares and $1.3bn in Mastercard stock however its by no means a “dump” and its about 13% decrease for visa to 8.3 million shares and its Mastercard holding by 7% to 4 million shares. Also keep in mind this is not uncommon to reduce shares, for example they reduce their holding of apple a few quarters ago.
8. Buffet and to an extent Berkshire is driven by a rule of only investing in things he knows and/or use. It took them until 2018, literal decades before they were convinced to purchase apple and when they did, they went it big. It is now their biggest holding, worth about 160B
That’s it. You can judge for yourself what it means.