This is another free installment of “Off The Chain” so people can see what it is & decide if they would like to subscribe. Starting tomorrow all installments will only be sent to subscribers, except in rare situations. Hope you join us. -- Pomp
Legendary investors Warren Buffett and Charlie Munger spent yesterday trashing Bitcoin as “rat poison,” “turds,” and “harvested baby brains.” To be honest, I’m still trying to figure out how Munger came up with the baby brains comment because that one was super weird.
Normally I would simply chalk it up to a bunch of old timers talking about things they don’t understand but this time I did some research instead.
It led me to a much more interesting conclusion: Warren Buffett and Charlie Munger understand cryptocurrencies perfectly and they realize their life’s work is in jeopardy if Bitcoin succeeds.
Before you roll your eyes, remember that six of Berkshire Hathaway’s ten largest holdings are in legacy financial companies. They own:
9.5% of Wells Fargo
6.7% of Bank of America
17.8% of American Express
5.3% of US Bancorp
13.1% of Moody’s Corporation
6.1% of Bank of NY Mellon Corp
These guys aren’t dumb. They know exactly what is at stake. They want their opinions to come off in a nonchalant way. This is a calculated defense tactic though. They even brought their buddy Bill Gates on CNBC to say he would short Bitcoin if there was a way to do it.
In the least shocking development ever, Tyler Winklevoss and others were happy to give Bill step-by-step directions on how to short the dominant cryptocurrency. Don’t worry, he won’t do it. His job was merely to help his wealthy friends protect their crumbling empire.
Sound harsh? It’s not my fault that Berkshire Hathaway didn’t even beat the S&P 500 over the last decade.
Just imagine what will happen to Berkshire’s performance and Buffett/Munger’s compensation as more people realize that Bitcoin and cryptocurrencies are a direct & formidable threat to the “rich guy club” known as fiat banking. Buckle up, the barbarians are at the gate so this is going to be a wild ride.
— New York Stock Exchange owner adds Bitcoin: The Intercontinental Exchange owner of the largest stock exchange in the world is reportedly building a Bitcoin exchange for institutional investors. This follows reports that Nasdaq is considering a cryptocurrency exchange and Goldman Sachs is setting up a Bitcoin trading desk. Read more.
— Oracle will offer blockchain products: The world’s second largest software company Oracle will release blockchain software. It is expected to launch a platform-as-a-service blockchain product this month and decentralized ledger-based applications next month. Read more.
— Blockchain firm strikes $190M crypto mining deal: IOT Group’s subsidiary inked a deal with one of the world’s largest cryptocurrency miners. The company signed an agreement with Royalti Blockchain Group, an Australian partner to bitcoin mining hardware giant Bitfury, for the supply 20 megawatts of power over a 10-year term at an estimated cost of 11 cents per kwh. Read more.
— Binance CEO takes a shot at VCs: Binance CEO Zhao Changpeng wrote a blog post saying “the vast majority of ‘professional VCs’ have no clue about the projects or field they invest in.” He added that ICOs aren’t just nice-to-have — they are necessary. Read more.
— Bill Gates says he would short Bitcoin if he could: Another day, another billionaire slamming Bitcoin. Bill Gates said he would short the cryptocurrency if there was an easy way to do it. He made sure to add that he thought the blockchain is promising, though. Read more.
— Warren Buffett calls Bitcoin ‘rat poison squared:’ Warren Buffett wants you to know that he really, really doesn’t like Bitcoin. He described the cryptocurrency as “probably rat poison squared,” and told CNBC on Monday that it’s “creating nothing.” Read more.
— South Korea to ease cryptocurrency regulation: The head of South Korea’s top financial regulator will consider relaxing cryptocurrency regulations, specifically on domestic cryptocurrency trading. He said there are “some positive aspects” regarding crypto. This is big considering South Korea banned ICOs last year. Read more.
— Saudi Arabia increases blockchain focus: Saudi Arabia has gotten cozy with a few U.S-based blockchain startups. It just hosted a “blockchain bootcamp” with ConsenSys and recently teamed up with Ripple to pilot instant cross-border payments between banks. The move signifies a transfer of focus from oil to emerging technologies, such as blockchain and digital tokens. Read more.
— Steph Curry is now a CryptoKitty: NBA superstar Steph Curry will be launching the first-ever celebrity-branded CryptoKitty. CryptoKitties is a blockchain-based game that allows users to purchase, collect, and sell virtual cats. The company raised $12 million in funding from investors like Andreessen Horowitz and Union Square Ventures. "The cats have reached the moon.” Read more.