US investment fund Soros Fund Management is reportedly planning to invest in cryptocurrencies despite the fact that the head of the fund, George Soros earlier defined digital currencies as a “bubble”.
A Bloomberg report said that Adam Fisher, who oversees global macroeconomic investments at Soros, received an internal approval to trade virtual currencies which are being ignored by most of the traditional money managers due to their volatility and lack of regulation. Fisher hasn’t taken any action yet.
George Soros had always been a crypto critic, in his speech at the World Economic Forum on 25 January in Davos, the billionaire dispraised Bitcoin saying it isn’t a currency at all.
“Bitcoin is not a currency because a currency is supposed to be a stable store of value and the currency that can fluctuate 25% in a day can’t be used for instance to pay wages because wages drop by 25% in a day. It’s a speculation. Based on a misunderstanding.”
However, he did acknowledge the potential of blockchain technology and said it could be put to “positive use”.
Since Soros’ comments about Bitcoin, the cryptocurrency has fallen 41 percent in value.
Bitcoin was priced nearly $20,000 in mid-December 2017 traded down at $6,600 on last Friday.
The downfall of cryptocurrencies has caused a lot of hedge funds to lose an average of 50 percent in value; however, the funds that started investing in cryptocurrencies at the start of 2017 managed to double their profits.
Soros started taking interest in cryptocurrencies from early 2017 when the Soros Fund became the third largest stakeholder in overstock.com, the first major e-commerce company to accept Bitcoin as a payment option. Overstock.com is planning to develop a digital asset trading platform and has therefore attracted Wall Street’s interest.