Does Warren Buffett Own Bitcoin?

As one of the world’s most prolific investors of all time, any comment Warren Buffett makes related to the economy, stocks or even cryptocurrency generates significant attention.

Regarding cryptocurrencies and Bitcoin (BTC 0.74%) in particular, Buffett has not shied away from criticizing the burgeoning asset class. On a number of occasions, Buffett has compared Bitcoin to the tulip mania that swept through the Netherlands about 400 years ago and is seen as one of the first financial asset bubbles.

He repeatedly said that he does not own any Bitcoin and never will. But what if I told you that Warren Buffett actually owns some Bitcoin? The answer is a bit complicated, but you might be surprised to discover that Buffett and his conglomerate company Berkshire Hathaway (BRK.A -3.02%) (BRK.B -2.89%) back a financial technology company concerned with crypto and more specifically Bitcoin.

ONE Now form of banking

The company is Nubank (NOW -2.58%), and it is revolutionizing banking in Latin America. Nubank is based in Brazil, but also serves customers in Mexico and Colombia. The main goal of Nubank is to offer banking services to all income groups, not just the wealthy, the traditional customer base of Latin American banks. It offers a range of products that allow customers to spend, save, invest, borrow and protect their money in new and innovative ways. And one of these new and innovative products revolves around crypto.

In June 2022, Nubank launched its own crypto trading platform that would allow its customers to buy and sell Bitcoin and Ethereum (ETH 3.40%). So far, the new product seems to be a hit as more than 1 million customers registered as users on the platform in less than one month. Nubank originally thought it would take at least a year to reach these numbers.

The decision to move to crypto was best summed up by Nubank CEO David Velez. In an interview, the CEO stated that “cryptocurrencies are a growing trend in Latin America” ​​and that the willingness to offer a crypto-based product was the result of a belief that cryptocurrencies have “transformative potential in the region.”

Buffett and Bitcoin

Now comes the interesting part. In an act of support, Nubank made the decision to allocate 1% of its cash on balance to Bitcoin. The company said the move was made to “reinforce the company’s conviction” in the potential of Bitcoin.

As of June 30, Nubank had approximately $3.1 billion in cash. With 1% allocated to Bitcoin, that would mean roughly $30 million in Bitcoin based on the latest earnings report.

Warren Buffett does not directly own any Bitcoin. On more than one occasion, he has made his voice heard about how he believes cryptocurrency is worthless and has no intrinsic value. But his 2.3% stake in Nubank gives him indirect exposure to the asset.

To have some fun, we can calculate how much Bitcoin Buffett is indirectly exposed to. With his 2.3% stake in Nubank, that means Buffett “owns” somewhere around 27 bitcoins (worth about $570.00 at today’s prices) based on today’s prices.

From trend to strategy

This is certainly a broad assumption and only meant to speculate a bit, but there is an angle here that is worth mentioning: Bitcoin continues to permeate the world of finance. Naysayers like Buffett may realize that it is becoming increasingly difficult to protect their portfolios from gaining exposure to the asset class, even if the exposure is indirect.

The trend of companies holding Bitcoin is a trend that only seems to be growing. Based on a handful of developments, such as BlackRock (the world’s largest financial management company) offering Bitcoin to institutional investors, it is plausible to assume that what is now just a trend could develop into a full-fledged strategy embraced by companies to create a well-balanced portfolio.

In preparation for the shift from trend to legitimate strategy, investors can follow what some of the world’s most innovative companies are doing – owning some Bitcoin.