“Warren Buffett’s ‘crypto stock’ may outperform tech giants Apple and Amazon, yet it still falls short in comparison to the revolutionary potential of Bitcoin.”
Warren Buffett, the renowned investor and CEO of Berkshire Hathaway, may have been skeptical about cryptocurrencies like Bitcoin in the past, but he is now reaping the benefits of his investment in a crypto-friendly bank. Buffett’s firm purchased 107 million shares of Nu Holdings, the owner of Nubank, a Brazil-based fintech company that offers crypto-related services.
Berkshire Hathaway initially invested $500 million in Nu Holdings in June 2021 and later increased its stake by another $250 million in December 2021. According to the company’s second-quarter 2023 earnings report, Berkshire Hathaway has not sold any of its Nu shares since then. As a result, Buffett’s $750 million position in Nu Holdings is now worth around $879.50 million.
Nubank is considered crypto-friendly because some of its divisions provide crypto-related services to over 1.35 million users. The company offers a Bitcoin exchange-traded fund (ETF) product through its trading platform called Easynvest. It also allows users to trade Bitcoin and Ether on its digital financial services platform.
In addition to its crypto-related services, Nu Holdings allocated 1% of its cash holdings to Bitcoin in May 2022. The company expressed its belief in Bitcoin’s potential to disrupt financial services in the region.
Nu Holdings’ success has outperformed other top holdings of Berkshire Hathaway, such as Amazon and Apple. While Nu’s stock has risen nearly 106% year-to-date (YTD), Amazon and Apple have gained 54.65% and 36%, respectively. Apple is the largest holding of Berkshire Hathaway, comprising approximately 45% of its investment portfolio.
Interestingly, Bitcoin’s price performance has caught up with Nu’s stock performance this year. Bitcoin’s price is also up 106% YTD, thanks to recent market trends and the excitement surrounding the launch of Bitcoin exchange-traded funds (ETFs).
Despite this convergence, some commentators argue that Bitcoin’s recent decoupling from the stock market is driven by optimism surrounding the approval of Bitcoin ETFs. They suggest that if the stock market experiences a significant downturn, Bitcoin’s performance may be affected as well.
It’s important to note that this article does not provide investment advice or recommendations. Investing in cryptocurrencies and stocks involves risks, and readers should conduct their own research before making any investment decisions.