In a recent report, Miller Opportunity Trust, one of the funds supplied by funding agency Miller Worth Companions, stated that Bitcoin has the potential to become a form of digital gold.
Legendary American value investor William H. Miller III is the Founder, Chairman, and Chief Funding Officer of Miller Value Partners.
Before beginning Miller Value Partners, Bill Miller and Ernie Kiehne based Legg Mason Capital Administration, they usually labored as portfolio managers of the Legg Mason Capital Management Value Trust from its inception in 1982.
It is very important level out that Miller isn’t your common fund manager. As CNBC noted back in June 2018, Miller’s 15-year streak (through 2005) of beating the is S&P 500 is still a benchmark no active manager can touch.”
Miller Opportunity Trust is “a versatile, value fund with a contrarian bent for traders eager about the long run.” It’s managed by Bill Miller and Samantha McLemore.
In accordance with a new investor report, the Miller Opportunity Trust fund used Bitcoin’s price crash in Could as an opportunity to put money into the asset through the Grayscale Bitcoin Trust (GBTC).
The report stated the fund had been observing Bitcoin for a “very long time” and obtained approval to invest in GBTC over the past quarter. The fund utilized Bitcoin’s falling price to commerce one of the trust’s “larger discounts to its underlying holding in Bitcoin” thereby creating upside potential.
The investor report additionally noted Bitcoin’s utility as a form of “digital gold” and stated it was positioned to understand favorably when in comparison with gold’s market capitalization:
We imagine Bitcoin has important upside potential as a form of ‘digital gold’. With gold’s market capitalization higher than $11 trillion, Bitcoin’s current cap close to $600 billion would have a protracted solution to go to catch up.
The fund, which holds $2.8 billion in assets, stated the market for Bitcoin was early in a continuing adoption curve, leading to price volatility. Nevertheless, the report concluded that the risk-reward for Bitcoin is “engaging” given the upside potential.
In his “4Q 2020 Market Letter” (published on January 5), Miller had this to say about Bitcoin:
“The Fed is pursuing a coverage whose goal is to have investments in cash lose money in actual terms for the foreseeable future. Corporations such as Square, MassMutual, and MicroStrategy have moved money into bitcoin relatively than have assured losses on money held on their steadiness sheet. Paypal and Square alone are estimated to be buying on behalf of their clients the entire 900 new bitcoins mined every day.
“Bitcoin at this stage is the greatest thought of as digital gold but has many benefits over the yellow steel. If inflation picks up, or even when it doesn’t, and more corporations resolve to diversify some small portion of their cash balances into bitcoin as a substitute of money, then the current relative trickle into bitcoin would become a torrent. Warren Buffett is famously called bitcoin ‘rat poison. He could be proper. Bitcoin may very well be rat poison, and the rat may very well be money.“
Then, on January 8, during an interview with Kelly Evans on CNBC’s “The Exchange”, Miller had this to say about Bitcoin’s worth volatility:
“It’s important to count on that it’s going to be very, very volatile In the event you can’t take the volatility, you most likely shouldn’t own it. However, its volatility is the value you pay for its efficiency.“
The views and opinions expressed by the writer, or any individuals talked about in this article, are for informational functions only, and they don’t represent financial, investment, or different advice. Investing in or trading crypto assets comes with a threat of financial loss.