So here’s something you don’t see every day. Mark Casey, a portfolio manager at the massive Capital Group, is making a huge bet on Bitcoin. That’s interesting on its own, but what really stands out is that Casey is a known follower of Warren Buffett. And Buffett, as you probably know, is famously not a fan of Bitcoin. He’s called it “rat poison squared” in the past. So this is a pretty big departure.
Why Bitcoin Over Gold?
Casey’s reasoning, according to a recent Wall Street Journal report, is pretty straightforward. He sees Bitcoin eventually overtaking gold as the main place people park their money for safety—the whole ‘store of value’ idea. He’s not alone in that thought, but coming from someone at a firm like Capital Group, which manages something like $3 trillion in assets, it carries a different weight. They’re apparently viewing Bitcoin more like a commodity than a currency. I think that’s a distinction a lot of big players are making these days.
But here’s the catch: Casey is all in on Bitcoin specifically. He doesn’t seem to think much of other cryptocurrencies. It’s Bitcoin or bust, at least in his view.
The Big Bet on Michael Saylor
This isn’t just theoretical for Casey’s firm. Back in 2021, Capital Group put its money where its mouth is. They scooped up a huge stake in MicroStrategy—now just called Strategy—the company run by Bitcoin evangelist Michael Saylor. We’re talking an initial investment of around $500 million for over 12% of the company.
That bet has paid off handsomely, at least on paper. Even though their ownership share has been diluted down to about 8% since then, the value of that stake has ballooned. It’s now worth more than $6 billion thanks to the massive rally in Strategy’s stock. They’ve also invested in other firms with big Bitcoin treasuries, like Japan’s Metaplanet.
A Shift in Sentiment?
Lately, though, the winds might be shifting. The stocks of these Bitcoin-heavy companies have taken a pretty serious hit over the last couple of months. They’ve been underperforming badly, which suggests that the feverish excitement around them might be cooling off.
And there might be more caution ahead. Analysts at JPMorgan recently pointed out that Strategy’s failure to get into the S&P 500 index could be a bad sign. It might signal that the broader market still isn’t totally comfortable with this new model of a company being so tightly wound to the price of Bitcoin.
So it’s a fascinating contradiction. You have a major traditional investor making a colossal, Buffett-contradicting wager on Bitcoin’s long-term role. But the short-term path for the companies betting everything on it looks a lot rockier than it did just a few weeks ago. It makes you wonder how this all plays out.
