REUTERS/Brendan McDermid
- Joel Greenblatt isn’t a bitcoin investor because there’s no intelligent way to value the cryptocurrency, he said.
- The Gotham co-CIO doesn’t have “fear of missing out” on bitcoin’s gains, because he likes sticking to what he knows.
- “I have no basis on which to say it’s going to go higher or lower,” the Warren Buffett disciple said Tuesday.
Veteran investor Joel Greenblatt hasn’t bought any bitcoin, because he doesn’t think there’s an intelligent way to value the cryptocurrency.
“Bitcoin is never gonna earn any money,” the co-CIO of Gotham Asset Management said in a Tuesday episode of the “Investor’s Podcast Network.”
“To me, it’s a speculation. I have no intelligent way to value it. So I’m not saying people will make money speculating in bitcoin or gold,” he added.
“It’s alien to me as an investment because I can’t value it. It has no inherent value. It has no earnings.”
Greenblatt, famous for providing seed money to “Big Short” investor Michael Burry to start Scion Capital, averaged annual returns of 50% between 1985 and 1994 when he was managing Gotham Capital. He’s attributed his success to following the investing philosophies of Warren Buffett and Ben Graham.
Berkshire Hathaway CEO Buffett himself has criticized bitcoin, describing it as “rat poison squared” and saying it “doesn’t produce anything.”
Value-investment guru Greenblatt said he’d been wrong in believing bitcoin would never hit the dizzying heights that it’s managed to achieve. But sticking to what he knows is important to him, he added.
Bitcoin was last up above $47,000 as market sentiment has turned bullish over the past week, alongside a broader rally in global asset prices. Crypto experts consider this to be the beginning of a strong bull market.
“I don’t feel bad about it,” Greenblatt said, adding that he feels disciplined he didn’t participate in the crypto craze.
“And of course, you’re gonna miss thousands of things that you woulda-coulda-shoulda bought. But if you just concentrate on the things that you’re working on, and they do well, that’s really what you have to realize.”
Even though Greenblatt isn’t an active bitcoin investor, his view about the leading cryptocurrency doesn’t seem to be negative.
“People have tried to make a case for me for the various uses for bitcoin, or why I should stay. And I can’t say I’m completely dismissive,” he said.
“I’m saying, ‘Gee, I really can’t figure this out.’ I have no basis on which to say it’s going to go higher or lower.”
He compared bitcoin to expensive art, saying some pieces can be highly valuable now, but perhaps not in the future.
“It’s in the eye of the beholder,” he said.
Bitcoin is still down 31% from its all-time high of around $69,000 in November, according to data from CoinGecko.
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