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.”
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.”