Buying Bitcoin “Is Not Investing” Says Billionaire Investor Warren Buffett

Francisco Memoria
  • Billionaire investor Warren Buffett claims buying bitcoin isn't investing.
  • According to him, buying cryptocurrencies is speculating, as people just want others to buy at a higher price later on.

Berkshire Hathaway CEO and billionaire investor Warren Buffet has recently stated he believes buying cryptocurrencies like bitcoin “is not investing,” and laid out his thoughts on the crypto market during an interview with Yahoo Finance in Omaha.

According to the investor, there are two kinds of items people buy when they think they’re investing. He explained that “one really is investing, and the other isn’t.” Bitcoin, per Buffett, isn’t.

The CEO then compared investing in cryptocurrencies to other investments. He said:

“If you buy something like a farm, an apartment house, or an interest in a business… You can do that on a private basis… And it’s a perfectly satisfactory investment. You look at the investment itself to deliver the return to you. Now, if you buy something like bitcoin or some cryptocurrency, you don’t really have anything that has produced anything. You’re just hoping the next guy pays more.”

Warren Buffett

Buffet continued, adding that buying bitcoin and other cryptocurrencies isn’t investing, but speculating. Although he claimed there’s nothing wrong with speculating, he implied cryptocurrency users just buy so someone else buys at a higher price later on, which to him is a “kind of game.”

Per his words, if regulators stopped people from trading farms, apartments, or even equities, investors would still do fine. If the same happened to “some bitcoin which nobody knows exactly what it is,” people wouldn’t want to buy.

Notably, the billionaire has earlier this year poured contempt on the cryptocurrency industry, stating that he can say “almost with certainty” that cryptocurrencies would come to a bad ending.

During an interview on CNBC’s “Squawk Box,” Buffett was asked if he had considered opening a futures position to short the market. He revealed he wouldn’t do it, as he gets into enough trouble with things he knows something about, so asked “why in the world” should he take a short position in something he “knows nothing about.”

Nevertheless, he maintained cryptocurrencies would come to a bad ending, and added Berkshire Hathaway doesn’t own or short any cryptocurrencies, and “will never have a position in them.”

New Bitcoin Mining Pool Comes out of Nowhere, Already 5th Largest

Colin Muller

Just a day after Bitcoin’s third halving, a new mining pool has burst onto the scene and instantly taken the #5 spot in Bitcoin mining by hashrate.

#5(source: BTC.com)

The pool, known as Lubian.com (links to a Chinese site), is pushing out almost 7,000 petahash/second at the time of writing. The pool’s provenance and identity is unknown online, and the only functional button on the pool’s website leads to a support email amid what is otherwise boilerplate marketing.

Crypto industry commentator and founding partner of Primitive Ventures Dovey Wan speculated that Lubian probably owns all its own hardware, as no other hashrate seems to have been poached from competing pools. She considered this an example of the dominance of “whales” (and sharks!) in the Bitcoin mining space. Indeed, ASIC miners are expensive pieces of kit that are usually not economically viable for individuals to run, to say nothing of the technical expertise required to operate.

While it has been reported that the pool has existed since late April in a private form, only yesterday (May 12) did it appear on BTC.com as a cohesive mining pool.

CryptoGlobe recently reported that up to 30% of Bitcoin miners could be made redundant on the network following the halving, too inefficient to keep up with miners operating newer machines and thus forced to leave.

Featured Image Credit: Photo via Pixabay.com