Billionaire who thinks bitcoin may become worthless will buy if it gets to $12,000

According to Thomas Peterffy, billionaire founder and chairman of online trading platform Interactive Brokers, inflation is here to stay. He holds a hedge in bitcoin, but believes it might become worthless or outlawed. However, he will buy it if it hits $12,000.

In a video chat with Forbes, the billionaire was not optimistic about the future of the U.S. economy. He said that inflation is likely to persist for years. His reasons for this are the decades of “chronic” deficit spending, supply chain disruption, a shortage of skilled workers, companies’ self-imposed ESG, and rising interest rates (the very thing supposed to bring inflation down).

Inflation

Peterffy doesn’t believe that inflation is a “short-term issue”. He states:

“As the Fed raises interest rates, it is raising the amount the country must pay to service its debt. This is a vicious cycle that will eventually result in exploding debt.”

He disagrees with the opinion that Fed Chairman Powell is going to do what one of his predecessors, Paul Volker, did in the 1980s, when he raised rates as high as 20%.

“I do not believe the Fed will follow through on its ‘do what it takes’ promise [to bring down inflation], because they are afraid of destroying the economy and the exploding debt issue,”  

Changing views on crypto

In January, Peterffy was on record as saying that in his view investors should consider delegating a small part of their portfolio to crypto in order to hedge against fiat currencies “go[ing] to hell.”

However, he has since changed his tune following the sharp downturn in the cryptocurrency market, and he now thinks bitcoin may become worthless or be outlawed as the U.S. government feels cryptos could be used for illegal financing, and might struggle to control the taxes to be paid on them.

Nevertheless, he still holds bitcoin, and has said that he’ll buy more if the number one cryptocurrency reaches a price level of $12,000.

Another billionaire’s opposing view

Another billionaire, in the shape of the legendary Stanley Druckenmiller, is generally opposed to Peterffy’s view. He has said that if he were younger he would be deeper into crypto. He made his fortune by accurately predicting, and betting on the future.

He says that he is “probably too old to compete intellectually with the younger people in the space”, but that he is “monitoring it”.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.