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Bill Miller: Bitcoin Is 50% Of My Portfolio

It looks like Michael Saylor isn’t the only billionaire to make Bitcoin his premier asset holding.

Bill Miller – top investor and former chairman of Legg Mason Capital Management – recently revealed that Bitcoin comprises half of his portfolio. He recommended that other investors become at least 1% allocated to the asset, calling it “insurance against financial catastrophe.”

Miller’s Growing Bitcoin Position

Miller revealed his Bitcoin position in an interview with Wealthtrack on Friday. In explaining his lack of diversification, he points out how the richest few in America are highly concentrated investors. He believes it reflects confidence in their investments – as he has for Bitcoin.

“Bitcoin can’t be touched by the government,” he said. “It’s a peer to peer decentralized independent network – a ledger that records every transaction. It’s public, and immutable.”

Investor Bill Miller reveals biggest mistake value investors make
Bill Miller. Source: CNBC

The investor credits Wences Casares – aka “Patient Zero” – as the one who introduced him to Bitcoin in 2014. Upon learning that Bitcoin was scarce and non-confiscable, Miller decided that a 1% allocation was “reasonable”. So he made his first investment at $200 and purchased more at $500.

Miller wouldn’t buy in again until spring of 2021 at $30k after Bitcoin bottomed out from its $64k high. However, considering that more investors and VCs were experimenting with it, he decided to increase his allocation to 50%. Ever since he’s been adding to this and other related positions, including SDIG – a Bitcoin mining company – and MicroStrategy stock.

Non-Confiscable Gold

Like many other investors, Miller likens Bitcoin to “digital gold” to escape monetary debasement. However, unlike gold, he said that the US government could not confiscate Bitcoin as FDR did in 1933. A user can easily send their Bitcoin to another inaccessible location or address in short order and low cost.

Furthermore, Bitcoin possesses even stronger scarcity than gold, which fluctuates even as more mining power comes online. By contrast, miners receive incentives for higher production when gold demand rises, thus inflating its supply. As such, Miller does not own any gold, citing Bitcoin’s superior long-term performance.

“I’m observing Bitcoin’s trajectory as a new technology, and comparing it to the trajectories of things like the printing press, steam engines, railroads, automobiles, and electricity… it’s following a well-understood path for the adoption of new technologies, “ argued Miller.

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Bitcoin has declined over the past month but has averaged 117% YoY returns since 2013.

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