SINGAPORE (Mar 5): What do Warren Buffett, Prince Al-Waleed Talal and Jamie Dimon have in common? Aside from being ludicrously wealthy and respected personalities in the financial world, they are also vocal critics of bitcoin and its crypto cousins. Buffet, probably the most celebrated investor in history, has amassed a personal fortune of US$83 billion ($109.3 billion) through his savvy investments across a multitude of asset classes and businesses. So, I can’t think of a better point of reference when analysing investments in any asset — including, more recently, bitcoin.

Buffett says of bitcoin, “What’s going on will  definitely come to a bad ending.” He goes on to say, “If I could buy a five-year put on every one of the cryptocurrencies, I’d be glad to do it, but I would never short a dime’s worth.” Put simply, what he means is that he would be willing to bet that all cryptocurrencies will collapse in five years, but it is dangerous to “short” (bet that the price will fall in the short term) them. As with all bubbles, you never know how big it can get. So, it becomes perilous and possibly costly to bet against the trend in the short term.

To put things in perspective, the market value of all cryptocurrencies (that is, token price multiplied by number of units in the market) is US$433 billion today, after having fallen about 40% from its December 2017 peak. During its peak, the value of cryptocurrencies exceeded Buffett’s flagship company, whose market value is US$500 billion.

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