• Investor Bill Miller said Friday he anticipates bitcoin surging by 100% in 2021 as more people add the asset to their portfolios as a hedge against inflation.

  • “The interesting thing about Bitcoin is that it gets less risky as it gets higher, which is the opposite of stocks,” the legendary investor said. 

  • He went on to say he’s not sure when Bitcoin’s price will correct, and if investors can’t tolerate a 80% correction, they should not buy bitcoin.

Investor Bill Miller said this past Friday he views bitcoin as going up 100% this year as more people start using the asset as an inflation hedge.

Miller said investors should hold about 1-2% of their investments in bitcoin instead of cash, because cash will lose at least 2% with current inflation rates. 

“Having a little bit in bitcoin is more a risk management thing than anything else.”  the founder of Miller Value Partners said. 

He went on: “The interesting thing about Bitcoin is that it gets less risky as it gets higher, which is the opposite of stocks.”

Miller said he does not have a target for bitcoin’s price, but that he does have expectations.

“I believe bitcoin… will rise 50% to 100% within the next 12 to 18 months. And if you ask me will it be higher or lower, I would for sure say it would more likely be higher,” he said.

Bitcoin has more than doubled over the last 30 days, and gone up over 30% in 2021 so far. While some investors want to take profits now as the price explodes, many investors are waiting for a downturn to buy at a cheaper price.

Miller told people who are on the sidelines waiting that it already occurred in the first quarter of last year, when the price was at near $4,000.

“That’s what usually happens. Once a correction happens, investors who are waiting on the sidelines then wait for the correction to keep decreasing,” Miller said. “And after they missed the upside, they’re wondering if they should buy it then.”

“We’ve had several 80% corrections, if you can’t tolerate that, then you should not buy bitcoin,” he added. 

These statements come days after Miller published his fourth quarter market letter, where he told followers that bitcoin is “best viewed as digital gold”, but has many advantages over gold. 

“Warren Buffett has called bitcoin ‘rat poison,'” Miller said. “He might be correct. Bitcoin may be rat poison, but the rat could be dollars.”

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