Billionaire investor Stanley Druckenmiller is the chairman of Duquesne Family Office, which has $3.2 billion under management. He’s also a partner at investment firm Duquesne Capital Management. In 2016, he made headlines when he told a Bloomberg Television interviewer he wished he’d bought Bitcoin a long time ago. “I feel like a moron,” he said. Druckenmiller isn’t the only famous investor to regret missing out on Bitcoin. Peter Thiel, co-founder of PayPal, says he also wishes he’d bought Bitcoin when it was trading at $20 instead of $1,000.
In a recent interview with Bloomberg TV, billionaire Stanley Druckenmiller said that he was a “moron” for not buying Bitcoin 15 years ago. The former hedge-fund manager, who managed billions, had some strong words for the cryptocurrency he missed out on.
Let me tell you a story. In 2012 I co-authored a book called “The Dao of Capital” with a guy named Jeremy Yaffe. It was about the philosophy of money and how humans should treat it. In 2015, I was a guest on CNBC’s “Fast Money”, which is a little show about stocks that runs a few minutes in the morning. And on the show, I was talking about the Dao of Capital, and I was explaining why I believed Bitcoin was the greatest thing since sliced bread.Billionaire investor Stanley Druckenmiller recently explained why he has only invested $20 million in bitcoin (BTC), is skeptical of Ethereum (ETH) and would rather pretend Dogecoin (DOGE) doesn’t exist. When bitcoin first went up – from $50 to $17,000, I believe – I sat back, dumbfounded. And […] I wanted to buy them every day. He was growing up, and even though I didn’t think too much about it, I couldn’t get my head around the fact that he was growing up and he wasn’t mine, Druckenmiller told The Hustle earlier this week.
The problem that Bitcoin solves
A few years ago, Druckenmiller said bitcoin was a solution in search of a problem. Since then, however, it has moved in that direction on several occasions. First, he finally understood what problem Bitcoin was supposed to solve, and that problem was called central banking. I found the problem: When we adopted CARES and Chairman Powell started crossing all kinds of red lines about what the Fed can and cannot do. The problem is that Jay Powell and the world’s central bankers have gone crazy and made fiat currencies even more dubious than they already were when I owned gold, Druckenmiller said. Druckenmiller ended up never owning bitcoin when the price of the cryptocurrency rose from $50 to $17,000 and felt like an idiot. Then he got a call from fellow billionaire Paul Tudor Jones who said: Did you know that when bitcoin went from $17,000 to $3,000, 86% of the people who owned it at $17,000 never sold it? Well, it was great in my mind. So, here’s something that is in limited supply and 86% of the owners are religious fanatics. I mean, who the hell keeps anything between $17,000 and $3,000? And it turns out that none of them – 86% – sold it. There is also the new phenomenon of central bank madness, Druckenmiller said.
Old elephant trying to fit through keyhole
He eventually decided to buy $100 million worth of bitcoins at a price of about $6,200, but ran into some problems. Druckenmiller did not explain what it was, however. It took me two weeks to buy $20 million. I bought the set for about $6,500, I think. And I said: This is ridiculous. It’ll take me two weeks. I can buy that much gold in two seconds, he complained, adding: So, like an idiot, I stopped buying it. Next thing I know, [bitcoin] is trading at $36,000. Druckenmiller eventually took some of the fees and then some of his bitcoin investments, but he still kept an undisclosed amount of BTC. I never had the heart for it. I’m a 68-year-old dinosaur, but as soon as he moved and these institutions started lifting him up, I saw an old elephant trying to get through the keyhole, and they couldn’t get through in time, he said.
The future of Ethereum is uncertain
As for Ethereum and other cryptocurrencies, Druckenmiller said it will be very, very difficult to oust Bitcoin from its position as the main store of value among assets. I think bitcoin won the value storage game because it is a brand, has been around for 13-14 years, and has a limited supply. Will it be gold? I don’t know. For the past two years she has mimicked him well, he noted. At the same time, Druckenmiller praised Ethereum’s qualities as an exchange facilitator and leading platform for smart contracts. However, the billionaire said he was a little more skeptical about the company’s ability to hold its own. It reminds me a bit of MySpace before Facebook came along. Or perhaps a better analogy would be Yahoo, before Google came along. Google wasn’t much faster than Yahoo, but it didn’t have to be. All he had to do was be a little faster and the rest is history, Druckenmiller said. He also says that there could be a completely new and better payment system in the future that may not even be invented yet. In the meantime, bitcoin will likely continue to be considered a store of value, similar to gold. As long as Jay Powell keeps doing as he is doing, I think gold and bitcoin – and bitcoin seems to be a high-beta gold – will have tailwinds, Druckenmiller said.
I claim DOGE does not exist
Dogecoin, on the other hand, is not a serious consideration for Druckenmiller. Despite the many endorsements from billionaires like Elon Musk and Michael Saylor, DOGE is just one part of this Big Crazy Theory money wave, he says. I wouldn’t keep my mouth shut because I don’t like to make fire with my face. So I’m trying to pretend that Dodge doesn’t exist. I think about it so little that I don’t even mind if it grows, Druckenmiller admitted. Similarly, he compared Dogecoin to the burgeoning unfunded tokens in that it is the manifestation of the craziest monetary policy in history. And I think because there are no supply constraints, I don’t see the benefit of [Dogecoin] at this point. When bitcoin went up, I went crazy for not owning it. As Dogecoin grows, I find myself smiling, Druckenmiller concludes: Don’t be long and don’t be short. I mean, if you don’t like going to Vegas, that’s probably fine.
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The co-founder of Duane Reade, the retail giant and pharmacy owner, Stanley Druckenmiller, has admitted that getting in early on Bitcoins was a mistake. He told Bloomberg TV, “I felt like a moron not buying Bitcoin.”. Read more about next bitcoin stock and let us know what you think.
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