Value Investor Bill Miller Predicts Advisors to Recommend 1-3% Bitcoin in Portfolios Soon

Crypto Reporter

Shalini Nagarajan

Crypto Reporter

Shalini Nagarajan

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Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

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Last updated:

October 21, 2024 01:13 EDT

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Legendary investor Bill Miller anticipates that financial advisors will begin recommending a 1% to 3% allocation to Bitcoin in investment portfolios within the next three to five years.

Miller, who first purchased Bitcoin when it was trading around $200 after attending a lecture by entrepreneur Wences Casares, shared his insights in a recent interview with Forbes.

He underscored Bitcoin’s unique economic properties, noting that its supply remains fixed regardless of changes in demand or price. Bitcoin’s supply is capped, unlike traditional currencies or commodities like gold. Higher prices in these assets can lead to increased production. However, Bitcoin’s availability remains unaffected by market dynamics.

“It’s the only economic entity where the supply is unaffected by the demand or the price,” he said. “At the most basic level, all you have to believe is that the demand for Bitcoin will grow faster than the supply.”

Bitcoin’s Fixed Supply Could Propel Prices Higher, Unlike Gold: Bill Miller

He pointed out that Bitcoin’s price can keep going up if more people want it because its supply won’t increase. This differs from gold. When gold’s price rises, more gold may be mined, potentially driving the price back down.

Earlier this year, JPMorgan found that Bitcoin surpassed gold in investor portfolio allocations when adjusted for volatility. The bank reported that Bitcoin’s allocation in portfolios was 3.7 times greater than that of gold.

He said his interest in Bitcoin was sparked by Casares, an Argentine entrepreneur who spoke at the Allen & Co. Sun Valley Conference in 2012. Casares shared his experiences with economic instability in Argentina, where inflation and government actions repeatedly eroded personal wealth. He presented Bitcoin as a form of “digital gold” that could serve as a hedge against financial catastrophe and inflation.

“[Casares] said, I would suggest you consider putting 1% of your liquid assets into Bitcoin and then forget about it. You could lose all your money, but look how much it’s gone up in the last two years,” Miller said.

Bitcoin’s Independence from Central Bank Interventions Could Sway Financial Advisors

Reflecting on Bitcoin’s resilience during economic turmoil, Miller pointed out that while central banks had to intervene to keep traditional financial systems functioning during crises, Bitcoin required no such bailout.

“The Fed had to flood the system to keep the Treasury market functioning, but nobody had to come in and bail out Bitcoin. You can’t bail it out,” he said.

Based on these observations, Miller predicts that a majority of financial advisors will soon recommend clients allocate a portion of their assets to Bitcoin.