Ruffer, a London-based asset management firm, exited the Bitcoin market in April with a profit of slightly more than $1.1 billion for its customers.
“We carefully managed the position, and the overall profit was little more than $1.1 billion by the time we sold the last tranche in April,” Hamish Baillie, an investment director at Ruffer, told The Times of London today.
Ruffer exited the Bitcoin market because it believes that if the lockdowns are lifted, young people, whose trading activity is credited with igniting the bull market, will not stay at home trading cryptocurrencies.
The company has put its Bitcoin gains into “safe” assets like inflation-linked gilts, which are government-issued bonds that rise in tandem with the retail price index.
But, according to Baillie, Ruffer may return to Bitcoin.
Elon Musk, the CEO of Tesla and SpaceX, has recently popularised environmental criticism, but it doesn’t move Ruffer much. Much of the criticism is based on “hyperbole and disinformation,” according to Baillie, who claims that Bitcoin uses less electricity than the gaming industry.
Bitcoin gets “probably anywhere between 40% and 70% of its electricity” from renewable sources, according to Baillie.
Baillie also suggested that Bitcoin has significant social benefits, particularly in developing countries. “[Western] currencies have remained reasonably stable, but imagine holding bitcoin for ten years and living in Venezuela. Outside of the monetary system, it’s been a fantastic store of value,” he explained.
However, while owning Bitcoin may be a viable strategy for Venezuelans, it is no longer sufficient for Ruffer.