Considered by many to be one of the world’s most successful investors, George Soros went on record in January 2018 to state that cryptocurrencies are a bubble and could never be used to pay wages as the price was too volatile. At his annual speech at The World Economic Forum 2018 in Davos, Switzerland, he went on to say that Bitcoin’s primary purpose was for tax evasion and for dictators to build up a nest egg.
He did, however, acknowledge that “there is also a very innovative blockchain technology which can be used for positive or negative purposes.” One of his earlier fiat currency trades was a $10 billion short on the British Pound that made him $1 billion and almost broke the Bank of England.
Born in Hungary in 1930, he lived through German occupation towards the latter part of the WW II before moving to London in 1947. He graduated from the London School of Economics and emigrated to America in 1956 where he later launched his hedge fund, Soros Fund Management. He is reported to have donated $12 billion to philanthropic causes since making his fortune in the financial markets.
Despite Soros’ comments at the Davos Forum, he had already indirectly invested in cryptocurrency having bought almost 2.5 million Overstock shares at $40.10 per share in November 2017. The day after the announcement was made of his stake in the business the share price shot up by 25%. Overstock was one of the first major retailers to accept payments in bitcoin.
Bitcoin has fallen by more than 40% since Soros declared it was a bubble in January 2018. In the last few days, news has broken that approval has been given for his hedge fund to start investing in cryptocurrencies. Bloomberg has reported that Adam Fisher of Soros Fund Management has been given the go-ahead in the last few months to invest in cryptocurrencies.
Maybe Soros feels that with bitcoin trading at less than $7,000, it now represents good value for money compared with the ATH of almost $20,000 when he declared it was a bubble. When one of the world’s most successful investors decides to invest in cryptocurrencies, it will not go unnoticed for long. This could be the start of a bull run for bitcoin, but some are concerned that he could be looking to short the market as he did with the British Pound. Bitcoin is trading around 5% higher since the Bloomberg article went live.