Billionaire hedge fund manager Paul Tudor Jones believes that investing in Bitcoin draws strong parallels to early investors in tech firms like Google and Apple.
In an interview on CNBC’s Squawkbox on October 22, the American hedge fund manager and philanthropist said that Bitcoin could well be at the start of a very fortuitous period and might be an excellent hedge against rising inflation.
Jones’ comments came after Bitcoin surged past its highest peak in 2020 over $12,800 off the back of PayPal’s announcement that it would soon add cryptocurrency support on its platform in the coming months.
An inflation hedge
Jones pointed to the US Federal Reserve’s extended quantitative easing measures as the potential catalyst for inflation and believes that Bitcoin is a good bet as a hedge to combat that.
“The reason I recommended bitcoin is because it was one of the menu of inflation trades, like gold, like TIPS breakevens, like copper, like being long yield curve and I came to the conclusion that Bitcoin was going to be the best inflation trade,” Jones told Squawkbox.
His sentiments echo those of a number of cryptocurrency analysts and investment managers, including Anthony Pompliano who has been advocating Bitcoin as an effective inflation hedge against conventional financial institutions like the US Federal Reserve and its current economic stimulus practices.
Another chance for ‘early investment’ in tech
Jones also shared his renewed interest in Bitcoin and the characteristics that have strong parallels to some of the early big technology companies that have become global leaders in modern times.
“Bitcoin has a lot of the characteristics of being an early investor in a tech company and I didn’t realise that after, unfortunately, I came on your show and then got besieged by god knows how many people on Bitcoin,” Jones said.
‘I’ve got a small single digit investment in Bitcoin, that’s it, I am not a Bitcoin flag-bearer. But what I learned was and what I was so surprised by is that Bitcoin has this enormous contingent of really smart and sophisticated people who believe in it. Again, it’s like investing in Steve Jobs and Apple or investing in Google early, you’ve got this group of, it’s crowdsourced all over the world, that are dedicated to seeing Bitcoin succeed and becoming a commonplace store of value and transaction tool at a very basic level.”
The founder of Tudor Investment Corporation also said that Bitcoin could be in its proverbial ‘first innings’ as interest in the cryptocurrency is seemingly picking up once again.
This has been driven by major institutional and corporate investments into the preeminent cryptocurrency, with the like of MicroStrategy having allocated a total of $450mln to buy Bitcoin as a long term capital investment and holding.