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Warren Buffett, the famed billionaire investor, has been one of the loudest bitcoin and crypto critics amid a U.S. "war" on bitcoin.

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The bitcoin price has swung wildly over the last few years, soaring through the first half of 2023 as traders gear up for what could be a $17.7 trillion earthquake hitting the market.

Now, as a crisis is threatening to engulf the U.S. dollar, a new analysis of Warren Buffett's Berkshire HathawayBRK.B stock portfolio has revealed the Oracle of Omaha's best-performing investment this year is bitcoin and crypto-friendly Nubank.

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Buffett's Berkshire Hathaway invested $500 million in Brazil's Nubank in June 2021 ahead of its initial public offering (IPO) later that year. Buffett's Nubank holding is thought to be now worth around $840 million after he plowed another $250 million into the startup bank during its IPO.

The bank, which allows users to trade bitcoin and other cryptocurrencies and earlier this year launched its own cryptocurrency called nucoin, has seen its stock price rocket over 100% so far this year amid soaring revenue and customer numbers.

Analysis by Business Insider showed Nubank's stock market performance has topped Buffett's other holdings, including giants AmazonAMZN , AppleAAPL, Coca-Cola, Bank of AmericaBAC, and Kraft Heinz.

Earlier this year, Buffett dismissed bitcoin as a "gambling token" in an interview with CNBC, saying bitcoin "doesn't have any intrinsic value ... but that doesn't stop people from wanting to play the roulette wheel."

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Buffett has regularly slammed bitcoin and those that trade crypto, claiming during Berkshire Hathaway's 2022 annual shareholder meeting that bitcoin and crypto are not productive assets and branding bitcoin "rat poison squared."

"If you told me you owned all the bitcoin in the world and you offered it to me for $25, I wouldn't take it," Buffett said. "Whether it goes up or down in the next year, or five or 10 years, I dont know. But the one thing Im pretty sure of is that it doesnt produce anything."

Charlie Munger, Buffett's right-hand man at Berkshire Hathaway, has also heavily criticized bitcoin, just last week calling it "the stupidest investment I ever saw," during Zooms Zoomtopia conference, Fortune reported.

I am a journalist with significant experience covering technology, finance, economics, and business around the world. As the founding editor of Verdict.co.uk I reported on how technology is changing business, political trends, and the latest culture and lifestyle. I have covered the rise of bitcoin and cryptocurrency since 2012 and have charted its emergence as a niche technology into the greatest threat to the established financial system the world has ever seen and the most important new technology since the internet itself. I have worked and written for CityAM, the Financial Times, and the New Statesman, amongst others. Follow me on Twitter @billybambrough or email me on billyATbillybambrough.com.Disclosure: I occasionally hold some small amount of bitcoin and other cryptocurrencies.

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Warren Buffett Revealed To Be Quietly Making Bank From Bitcoin And Crypto Amid Price Swings - Forbes

As Bitcoin price oscillates in its valuation, showing a recent dip of 2.5% in seven days, several fundamental and geopolitical factors are coming into play to chart its future course.

Trading at $27,231 with a Monday surge of 1.50%, the cryptocurrency titan is facing pivotal moments.

Market speculation is rife as anticipation builds over the SEC's potential approval for Bitcoin ETFs, a move that could significantly alter the crypto landscape.

Furthermore, the revelation that the US government holds a more substantial Bitcoin reserve than any other country globally brings additional dynamics into the equation.

Meanwhile, the Australian Treasury's inclination to regulate cryptocurrency exchanges, focusing less on the tokens themselves, offers a fresh perspective on how nations choose to navigate the intricate web of digital currencies.

Bitcoin is currently witnessing heightened interest and market activity, largely influenced by a positive market sentiment surrounding the potential approval of a spot Bitcoin Exchange-Traded Fund (ETF) by the US Securities and Exchange Commission (SEC).

After the SEC chose not to oppose the court's ruling on the Grayscale Bitcoin ETF, there's an escalating conversation about the likelihood of the SEC approving various Bitcoin ETFs within the next 3 to 5 months.

This prospect has sparked significant excitement in both financial and cryptocurrency circles, symbolizing a possible turning point in the mainstream adoption and regulatory endorsement of Bitcoin.

The US government possesses the largest state-owned collection of Bitcoin in the world, amassing a total of 207,189 bitcoins valued at approximately $5 billion, primarily from asset seizures.

While many nations have liquidated their crypto reserves, the US has consistently expanded its holdings.

A recent study by Sachin Jaitly of Morgan Creek Capital highlighted a significant correlation between the rising money supply, concerns about inflation, and sovereign Bitcoin adoption.

Interestingly, the U.S. has auctioned off Bitcoin worth $366.5 million over time, potentially foregoing substantial gains from its appreciation.

Nonetheless, the influence of the US government's $5 billion Bitcoin reserve on hedging against inflation remains minimal, given the magnitude of the government's comprehensive balance sheet.

The revelation of the US government's considerable Bitcoin holdings could bolster confidence in the cryptocurrency markets, possibly influencing today's uptick in Bitcoin's value as investors interpret this governmental involvement as a bullish indicator.

The Australian Treasury recently unveiled a consultation paper detailing its intentions to regulate the nation's digital asset sector, particularly emphasizing cryptocurrency exchanges.

If these proposed regulations take effect, cryptocurrency exchanges in Australia could be required to secure a financial services license from the Australian Securities and Investment Commission (ASIC) should they hold more than $3.2 million or serve individual customers with amounts surpassing $946.

This initiative is largely perceived as a pivotal move towards bolstering consumer protection while simultaneously encouraging innovation within the digital asset domain.

Significantly, this regulatory shift seems to have cast a favourable light on Bitcoin (BTC).

Although the exact ramifications on the broader crypto market are yet to be ascertained, the introduction of regulatory clarity and a supportive stance for the industry in Australia has evoked positive reactions from investors.

This sentiment, in tandem with other prevailing market drivers, indicates a more bullish market perspective, potentially fueling BTC's current price trajectory.

From a technical standpoint, the 4-hour chart provides insightful revelations. The pivot point for Bitcoin currently rests at $27,254.

On the upper side, resistance levels are seen at $27,946, followed by $28,713 and a further resistance at $29,430.

Conversely, on the downside, Bitcoin finds immediate support at $26,474, with subsequent supports at $25,770 and $25,002.

In wrapping up the analysis, the overarching trend for Bitcoin leans bullish, especially if it maintains its stance above the crucial $27,255 mark.

Over the short haul, the current momentum combined with the bullish technical indicators suggests Bitcoin may very well challenge the resistance level of $27,946.

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Bitcoin Price Prediction: BTC Slips 2.5% as Regulatory Winds and ... - Cryptonews

By Mark Hulbert

Bitcoin's fair value is about $31,400, according to one respected forecasting model

Bitcoin over the next 100 years will produce an annualized return of 1.1%.

That's the prediction of a fair value model that's based on something called Metcalfe's Law. According to it, the value of a network is proportional to the square of the number of users.

Claude Erb, a former commodities portfolio manager at TCW Group, applies Metcalfe's Law to bitcoin (BTCUSD) by assuming that each mined coin represents one user in the network. Since the number of bitcoins that can ever be mined is known, along with when that total number will eventually be reached, Erb's Metcalfe's Law model is able to calculate the cryptocurrency's long-term expected return. That's the source of the projected 1.1% annualized return.

It's easy to poke holes in the model, as Erb himself is the first to point out. Some "users" in the bitcoin network own less than one coin, while others own more than one. And many bitcoins have been lost. So the number of bitcoins that have been mined doesn't exactly equal the number of users.

In an email, Erb said he offers his Metcalfe's Law-based model in the same spirit as those who observe that "all models are wrong, but some are useful." He added that his model is "a way to anchor a conversation" about the cryptocurrency's valuation that is sufficiently "intriguing" to warrant our serious consideration.

The model has done an admirable job, as you can see from the chart above. It has issued warning signals when bitcoin reached unsustainably high levels and provided encouragement when its price fell too low. I first devoted a column to the model in late 2020, just as bitcoin was about to triple from around $20,000 to over $60,000. The model held that such a price rise was unjustified, and bitcoin subsequently fell back below $20,000. At that point I reported that, per the model, bitcoin had become undervalued -- and it subsequently rallied more than 50%.

I last wrote about Erb's model in early June, reporting that bitcoin's fair value was about 10% above its then-current price. It's gained 4.2% since then. The model currently calculates that bitcoin's fair value is about $31,400, or around 14% above where it currently is trading.

Even if the model continues to do as good a job forecasting bitcoin's price, you should still expect the cryptocurrency to oscillate between extremes well-above and below fair value. That is something all assets do, and bitcoin is no exception.

Consider the stock market on the assumption that its fair value is based on its long-term average price/earnings ratio. Over the past 150 years, the S&P 500 SPX has traded for as much as seven times its fair value and as little as one third. That's similar to bitcoin's range in recent years.

Mark Hulbert is a regular contributor to MarketWatch. His Hulbert Ratings tracks investment newsletters that pay a flat fee to be audited. He can be reached at mark@hulbertratings.com

More: Bitcoin is set to thrive in October no matter where rates go, analyst says

-Mark Hulbert

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

10-14-23 1114ET

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Bitcoin is undervalued now but just look at its projected long-term ... - Morningstar

Bitcoin has just set a new record for the time spent in a mid-cycle consolidation phase between market cycle peaks.

It has been in this phase for eight months, according to technical analyst CryptoCon, who added that this cycle is still playing out the same as previous ones.

The analyst has used Fibonacci retracement levels to split market cycles into different phases.

This sandwich between phases 2 and 3 is served up cold every cycle, creating long sideways periods,

Bitcoin has been trading sideways since March, which was when it moved from the bottom phase to the transition from the low stage, where it currently remains.

In the first cycle, Bitcoin spent six months in this transitionary phase. In cycle two, it was also there for six months in 2015. The third cycle had a long sideways stage in 2019 and early 2020, and the pattern repeated in 2023 in the current market cycle.

Moreover, analysts have also predicted that a pivot point will occur in November, when there may be a final flush-out before a more sustained move upwards.

Most have been in agreement that the next cycle will begin in earnest after the halving event in April or May next year. Until then, it will be more lethargy with a possible dump before the end of this year.

On October 16, analyst CrediBULL Crypto updated his short-term predictions, saying he remained cautious at current levels.

He observed the clear sideways/accumulation below and a move to the upside. However, we know that this move has primarily been driven by short squeezes and on low volume a liquidity hunt rather than a strong impulsive move up imo, he said.

Bitcoin is currently changing hands for $27,210, having reclaimed the $27K level during Monday mornings Asian trading session.

The asset spent most of the weekend trading in a tight range at the $26,850 zone before breaking out on Monday.

Nevertheless, BTC has lost 2.7% over the past seven days, having failed to break resistance at $28K.

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Bitcoin Still Sideways But Cycle Patterns Remain on Track - CryptoPotato