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There are many ways one could measure Bitcoin’s penetration into mainstream investing. One of the more exotic is measuring Warren Buffet’s indirect exposure to Bitcoin despite his distaste for the new asset class. 

Why Does Warren Buffett Dislike Bitcoin?

Following the rapid descent of Gautam Adani after Hindenberg’s scathing report, Warren Buffett is now ranked the world’s 5th richest man, at $108.9 billion net worth, according to Forbes. Yet, besides his wealth, Buffett is best known as probably the most quotable investor alive.

Specifically, Warren’s value-oriented investment philosophy has had much traction. The ‘Oracle of Omaha’ once said that “price is what you pay, value is what you get.” But he also warned that “risk comes from not knowing what you’re doing.”

Both of those statements manifested regarding Buffett’s take on Bitcoin. Notably, he doesn’t see Bitcoin as ‘sound money,’ which is peer-to-peer, limited in supply, and censorship-resistant. Instead of emphasizing them, as some would say, revolutionary attributes, Buffett has always likened Bitcoin to something utterly irrational. 

When Charlie Munger called Bitcoin “rat poison” in 2013, BTC was at $100. Five years later, when Bitcoin got over $9,000, Buffett one-upped Munger’s take, calling it “probably rat poison squared.” Therefore, Bitcoin’s problem is not value appreciation but the baseline for it. 

“Cryptocurrencies basically have no value and they don’t produce anything. They don’t reproduce, they can’t mail you a check, they can’t do anything, and what you hope is that somebody else comes along and pays you more money for them later on, but then that person’s got the problem. In terms of value: zero.”

Warren Buffet to CNBC, February 2020

This view disregards fiat currency devaluation and the risk of having bank accounts frozen or going defunct via bank runs. It also conflates cryptocurrencies with Bitcoin, disregarding that each BTC is backed by energy. More importantly, Bitcoin’s core value is disambiguating the transmission of the value. 

Yet, as these Bitcoin attributes became recognizable, it was inevitable that Buffett himself would’ve been indirectly exposed to Bitcoin investments. 

Berkshire Hathaway’s Crypto Exposure

Since 1965, Warren Buffett has served as the Chairman and CEO of Berkshire Hathaway. In that time, the company grew to a $690 billion investment juggernaut. The bulk of Buffett’s portfolio is in Apple (41.76%) and other classic holdings such as Coca-Cola (7.57%), Chevron (8.02%), and Bank of America (10.30%).

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