Paul Tudor Jones III, the legendary hedge fund manager, announced his intention to maintain a “small” investment in bitcoin for life, citing its unalterable supply as the only thing humans can’t manipulate. In an interview with CNBC, the American billionaire predicted that the US Federal Reserve would discontinue its aggressive interest rate increase policy, which some experts believe may benefit the entire cryptocurrency industry and positively affect BTC’s price.
BTC Investor for Life
Jones, a well-known investor who entered the bitcoin ecosystem in 2017, is expected to remain tied to the primary cryptocurrency for the rest of his life. During the same interview, he praised BTC’s fixed supply of 21 million coins and vowed to maintain a small allocation in his portfolio:
“From the beginning, I’ve always said I want to have a small allocation to it because it’s a great tail event. It’s the only thing that humans can’t adjust the supply in. So I’m sticking with it; I’m going to always stick with it. It’s just a small diversification in my portfolio.”
For those who have been in the space long enough to have witnessed BTC trading at nearly $70,000, the current valuation may present a good buying opportunity, including Jones, who said he “would probably” purchase more. In addition, the billionaire addressed the inflationary environment in the United States and the Fed’s attempts to combat it, stating that the central bank’s interest rate hikes in early May were the last ones.
Higher rates result in higher borrowing costs, which lowers consumer spending and makes risky investments like cryptocurrencies less appealing. Many experts have argued that the opposite scenario could ignite a bull run for digital assets, among them Anthony Scaramucci, the founder of SkyBridge Capital and former White House official, who claimed:
“I do believe that the Fed declares victory at 4% to 5% inflation. If I’m right, there will be a resurgence in the market. There’ll be a lot of short covering in crypto, and there’ll be a rebirth of risk assets.”
Paul Tudor Jones’ Crypto Journey
The 68-year-old billionaire initially purchased Bitcoin for around $10,000 in 2017 and doubled his money by selling at $20K. However, his most notable interaction with the asset began in the spring of 2020 when he bought BTC as a hedge against inflation, predicting that inflation would quickly surge prompted by central banks’ mass printing of fiat currency. His prediction came true, with inflation reaching record highs worldwide, while BTC soared to nearly $70K at the end of 2021 before plummeting in 2022. Nevertheless, the asset began the current year on a positive note, reclaiming some of its lost ground. Jones’ support for BTC has grown so much over the years that he once declared it superior to gold as a hedge against inflation, stating:
“I do think we’re moving into an increasingly digitized world. Clearly, there’s a place for crypto, and clearly, it’s winning the race against gold at the moment, right?”