Billionaire Thomas Peterffy Says Bitcoin Has a Place in a Sensible Portfolio, but Only in Moderate Quantities

After Microsoft shareholders decided not to invest in Bitcoin, many no-coiners might be wondering whether Bitcoin has a place in a sensible portfolio

Billionaire investor Thomas Peterffy believes that Bitcoin has a place in a sensible portfolio, but only in moderate quantities.

Speaking to Bloomberg, the founder of retail brokerage Interactive Brokers Group Inc., said that investors should be careful due to Bitcoin’s volatility.

“I’m sort of scared of it, but I think everybody should have a little bit of it,” said Peterffy, whose net worth is estimated at US$53 billion (AU$82.7 billion).

“I don’t think it has any value, but neither does fiat currency. It’s just a way of transferring value.”

Peterffy’s firm will not allow clients to allocate more than 10% of their portfolio to Bitcoin.

“We’re not going to allow people to put, say, 50% of their net worth into Bitcoin,” he said.

“I think that’s crazy. It’s like putting 50% of your net worth on a roulette table, on red or on black. I don’t think it’s a sensible thing to do.”

Peterffy added that he is “not a big believer in crypto,” but he does believe that it will be around for a while.

“I think it’s here to stay, at least for the next five years,” he said.

“I don’t know what will happen after that. It could go either way.”

Investing legend Ray Dalio also recently expressed concerns about cryptocurrencies.

Speaking to Investopedia, the Bridgewater Associates founder said he prefers gold over crypto.

“I like gold better than crypto,” said Dalio.

“I think crypto has some merit, but I’m concerned about the privacy and paying too much tax, which I think many people are.”

Dalio also thinks that crypto hasn’t really proven itself as a hedge against inflation.

“I don’t think it’s proven itself yet to be a hedge against inflation. I think crypto doesn’t correlate that well with inflation and is still largely a speculative vehicle.”

Despite his concerns about crypto and a preference for gold, Dalio, like Peterffy, still has a small allocation in crypto, probably “just in case it catches on” – or to hedge against growing global debt.