The report says that an investment of $11 million made by Winklevoss brothers in Bitcoin four years back has climbed by almost 10,000 percent to worth more than 1 billion today, after last week’s price surge.
Winklevoss brothers, the identical twins, who sued Mark Zuckerberg, chairman and chief executive officer of Facebook, claiming he stole their idea to create popular social media platform, are banking on the sudden surge in the price of the popular cryptocurrency. Tyler and Cameron are said to be the first public figures to have become billionaires by investing in Bitcoin, reported The Telegraph. The report adds that an investment of $11 million made by Winklevoss brothers in Bitcoin four years back has climbed by almost 10,000 percent to worth more than 1 billion today, after last week’s price surge. Bitcoin topped $11,000-mark last Wednesday, recording a historic high.
According to a report in the Financial Times in 2016, Tyler had said, “We see Bitcoin as potentially the greatest social network of all.” Even then, the identical twins believed that Bitcoin was a missing piece of the digital economy that has potential to change the way transactions are made. The 36-year old brothers were first introduced to Bitcoin while holidaying in Ibiza in 2012, In 2015, they launched a digital currency marketplace – Gemini.
Bitcoin soared by 900 percent this year alone. Renowned hedge fund manager Michael Novogratz has called a target of $40,000 on the cryptocurrency by the end of 2018, even as the regulators kept on the edge over the rapid surge in the value and the hot air building up around it. He was among the first ones to call a target of $10,000.
While investors may be adding to their positions in the cryptocurrency market, Reserve Bank of India’s Executive Director Sudarshan Sen had said earlier this year that the central bank is not comfortable with non-fiat or private cryptocurrencies such as Bitcoin. Legendary investors from India and around the world have time and again cautioned investors to stay away from it. Thomas Carper, a senior United States Senator once remarked, “Virtual currencies, perhaps most notably Bitcoin, have captured the imagination of some, struck fear among others, and confused the heck out of the rest of us.”
No fundamental value
Legendary investor Warren Buffett had said in an interview to CNBC in 2014 that bitcoin is a “mirage”, adding that investors should “stay away from it”. In the same interview, Warren Buffett said, “It’s a method of transmitting money. It’s a very effective way of transmitting money and you can do it anonymously and all that. A cheque is a way of transmitting money, too. Are cheques worth a whole lot of money just because they can transmit money?… The idea that it has some huge intrinsic value is just a joke in my view.” Reiterating his belief on Bitcoins and cryptocurrencies, Warren Buffett told Marketwatch in October this year: “You can’t value bitcoin because it’s not a value-producing asset,” adding that it is a “real bubble in that sort of thing”.
The rapidly surging price of Bitcoin, without any underlying asset or value-base, has irked the top banker Jamie Dimon. “Bitcoin is a fraud and will blow up,” Jamie Dimon, the CEO of JPMorgan Chase, said earlier this year, adding, “The currency isn’t going to work.” He pointed out to the absence of an underlying monetary base to support its value. “You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart,” Jamie Dimon said.
Renowned investor Jim Rogers, sometimes referred to as commodities guru, too has sounded a note of caution on the prospects of cryptocurrencies, preferring to stay away from them for now. “I wish I was smart enough to buy cryptocurrencies.” Jim Rogers said in a recent interview with Kitco news. Further, Jim Rogers seemed to suggest that there might be a bubble building up in the cryptocurrency space. “It looks bubblish when you see the kind of price we see in bitcoins,” Jim Rogers said, adding that he doesn’t own any of the cryptocurrencies. “I certainly don’t know which one will come out on top, or if anyone comes out on top. But, I don’t own any.