Bill Miller said in a new investor letter that bitcoin's performance in the past year shows promise — and more companies decide to move portions of their balance sheets to bitcoin, wider adoption could move very quickly, according to the fund manager.
In his fourth-quarter Miller Value Partners investor letter, Miller closed with his meditations on bitcoin's climb past $31,000. Despite having a market capitalization higher than JP Morgan and Berkshire Hathaway, Miller said bitcoin is still early in its adoption cycle. It's best thought of as digital gold, according to Miller, but has "many advantages" over traditional gold.
As the Federal Reserve continues to pursue a policy "whose objective is to have investments in cash lose money in real terms for the foreseeable future," he said, companies like Square and MicroStrategy have moved their balance sheets into bitcoin. Both firms allocated millions to bitcoin this year, and Miller said if inflation picks up or if other factors cause more firms to pour into bitcoin, the floodgates of adoption will open.
"Warren Buffet famously called bitcoin 'rat poison.' He may well be right," said Miller in his letter. "Bitcoin could be rat poison, and the rat could be cash."