Paul Tudor Jones II, American tycoon and billionaire, has decided to buy Bitcoin futures as an inflation hedge.
In particular, Tudor admitted that a surge of inflation could result from the central bank pushing money. That’s why he tells his customers that the situation reminds him of the role that gold played in the 1970s.
Bitcoin is the fastest horse in the upcoming inflation race
According to Bloomberg, Jones noted that the best strategy for maximizing profits is to have the fastest horse in a note titled “Great Monetary Inflation”.
“If I’m forced to forecast, my bet is that it will be Bitcoin.”
Jones noticed that Bitcoin was the fastest horse.
For this reason, Tudor Investment Corp. Global Tudor BVI Fund managed by Jones authorized to hold as much as possible “A low single digit percentage of exposure” Of your Bitcoin futures assets.
This action makes him one of the first major hedge fund managers to choose to take over what has so far been rejected by the mainstream: Bitcoin.
The truth is, Jones emphasized that he was not a cryptocurrency freak. However, monetary policy to deal with the coronavirus crisis prompted investors to watch out for Bitcoin.
In fact, Jones found in his customer report that this was “Unprecedented expansion of every form of money that industrialized countries have never seen before.” According to his calculation, the equivalent of 6.6% of global economic output has been printed since February.
Bitcoin in particular was initially not the first choice for investors. He thought about gold, government bonds, and certain types of stocks before he recognized Bitcoin.
Jones sees bitcoin similarities to gold in the 1970s when the precious metal recovered sharply from $ 35 an ounce in 1971 to a peak of $ 180 in late 1974.
Invest in Bitcoin futures and don’t buy Bitcoin directly
Paul Tudor buys Bitcoin futures, but did not buy Bitcoin directly on the spot market.
Jones, although not a fan of cryptocurrencies, assured this “The most compelling argument for owning Bitcoin is the upcoming digitization of the currency everywhere, which COVID-19 is accelerating.”
An important element, however, is that Jones didn’t buy Bitcoin directly on the spot market. Rather, he went to the derivatives market, where he acquired bitcoin futures.
With that in mind, keep in mind that Bitcoin futures are ideal for institutional investors. The reason is that it can indirectly enter the world of cryptocurrencies.
In addition, it is currently unknown whether these futures are settled in cash or physically (in Bitcoin). However, Jones’ entry into the crypto industry remains a bullish indicator.
An important element that should be mentioned is that Jones included in his report a subjective classification of certain assets according to their ability to retain value. In this ranking, Bitcoin was in last place compared to financial assets, gold and cash.
“What surprised me was not that Bitcoin was the last one, but it did as well as it did,” he wrote. Nevertheless, in the same report, he defends the belief that Bitcoin will play a “growing role” as a hedging instrument in the future.
Still, Paul Tudor buys bitcoin futures and that can be very positive for his crypto adoption.