Warren Buffett gave another insight into the acquisitions in the last quarter. He has topped up at Nubank, which is considered to be extremely Bitcoin-friendly.
An SEC report released Monday, February 14 shows that Berkshire Hathaway has sold a portion of its Visa and Mastercard shares. On the other hand, the investment company increased its stake in Nubank , the largest Brazilian fintech company. In the fourth quarter of 2021 alone, the “Oracle of Omaha” bought shares worth around one billion US dollars. What's behind it? Is Warren Buffett a crypto fan after all?
Who is Nubank?
The Nubank is a Brazilian neobank and currently the largest in all of South America. It was founded in 2013 by Colombian David Vélvez, Brazilian Christina Junquerira and American Edward Wible. In 2018, the young fintech company was valued at one billion US dollars for the first time, making it a so-called unicorn. Nubank 's investors include well-known names such as Seqouia Capital , but also the Founders Fund initiated by Peter Thiel .
If you continue to sift through Nubank's list of early investors, you'll come across the name Berkshire Hathaway, among others. The holding company had even added 500 million US dollars in a Series G financing round in June 2018 In September 2020, Nubank acquired the trading platform Easyinvest , which has been offering a Bitcoin ETF since June 2021. The IPO followed in December 2021. A valuation of 41.5 billion US dollars was achieved. However, the share price then fell from around USD 12 to below USD 7 in January 2022. In the meantime, however, the share price has recovered strongly and is currently quoted at around USD 9.
Warren Buffett – a crypto lover?
Anyone who has been following Warren Buffett for a long time will have noticed that the legendary investor is certainly not one of the biggest Bitcoin fans. As recently as 2018, he had dubbed Bitcoin “rat poison squared” and thereby aroused the wrath of the crypto community. Two years later, shortly before the Corona crash, he made it clear to the news channel CNBC that he did not own any cryptocurrencies and would never own any (see video). Buffett's "right-hand man," Charlie Munger, has also shot at cryptocurrencies -- particularly bitcoin -- several times, calling them "disgusting" According to Munger, the "whole damn development is disgusting and against the interests of civilization."
However, a stake also caused a stir outside of the crypto community. According to Berkshire Hathaway's latest SEC filing, the Buffett group stocked up on Activision Blizzard shares in a big way in the fourth quarter of 2021. Berkshire Hathaway purchased 14,658,121 shares, valued at approximately $975 million at the time of publication. If Buffett were to sell the shares now, it would put the old master around $200 million in the coffers. But it gets even better. As Microsoft announced in January 2022, it wants to take over the gaming group at a price of $95 per share. Should this deal actually go through in the end, there would be another around 200 million dollars on top. Not a bad return for an investor
Crypto arrives in the mainstream
Now one could argue that Buffett does not invest directly in Bitcoin and Co., but in a bank. Even if it is a so-called neobank, this is nothing earth-shattering. Nevertheless - the Nubank is South America's largest bank, which is active in the crypto business, among other things. Warren Buffett may think what he wants. The mere fact that he holds crypto-friendly investments in his portfolio shows that Bitcoin and Co. are increasingly arriving in the mainstream and that even Warren Buffett can no longer avoid it. It's a bit reminiscent of Buffett's relationship with technology stocks, which he has long owned -- with a few exceptions like IBM– had avoided to the utmost. Only with the participation in Apple did a rethinking seem to have taken place, so that Buffett also joined Amazon a little later. The latter, however, was more thanks to his investment managers Todd Combs and Ted Weschler. It is also interesting that even the classic banks such as BNY Mellon , which Buffett holds in his portfolio, already offer cryptocurrency services.
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