Famed investor Warren Buffet said that cryptocurrencies is a bubble he does not understand but he also predicted that it will end in tears for investors.
Speaking to CNBC, the chairman and CEO of Berkshire Hathaway painted a dark future for cryptocurrencies:
"In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending," he said CNBC and added:
“I think what is going on will definitely come to a bad ending."
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Buffet didn’t explain the reason for his prediction, but has previously expressed concern about cryptocurrencies’ lack of intrinsic value.
Whatever his reasoning, Buffet's opinion is highly regarded by investors because during his time at Berkshire Hathaway the firm has comfortably out-performed the markets and other investment vehicles.
Nevertheless, Buffet admitted in his interview that he does not understand much about cryptocurrencies:
“I get into enough trouble with things I think I know something about, why should I take a long or short position in something I don’t know about?” he asked.
He then added he’s meeting students on Friday and expects they’ll ask him about Bitcoin, but “I won’t have the answers.”
Nor will he ever have an investment in cryptocurrencies. “We don’t own any, we are not short in in any, we will never have a position,” he said.
Buffet did, however, joke that announcing Berkshire Hathaway would do something in cryptocurrencies would likely pique investor interest, a reference to incidents like Kodak’s re-birth as a cryptocurrency player and the sudden share price surge after the Long Island Iced Tea Corp renamed itself “Long Blockchain”.