Famous investor Kevin O’Leary says he wants to at least double his holdings in cryptocurrencies by the end of 2021 and predicts “billions of dollars” could be poured into the market if cryptocurrency becomes a new asset class.
The “Shark Tank” investor had previously said that Bitcoin was “rubbish”, but later changed his mind.
O’Leary, who is president of O’Shares ETFs, said he is optimistic about cryptography and wants to allocate more to his personal portfolio.
“I want to increase my exposure to cryptography (currently at 3%) to 7% by the end of the year,” he told Capital Connection on Monday.
But he said investors want U.S. authorities to make decisions about regulating cryptocurrencies.
“I don’t want to get involved in cryptography if the regulator says it’s not okay,” he said. “I can’t afford to be out of the game, I can’t afford not to comply.”
The U.S. government is in the process of developing regulations for cryptocurrencies, although more countries are legalizing bitcoin. Last week, El Salvador became the first country in the world to adopt bitcoin as a legal tender.
This will not go away, this is the new asset class.
Kevin O’Leary
President of O’Shares ETFs
O’Leary said he expects regulators to recognize cryptocurrencies as a class of institutional assets, but it’s unclear when that will happen. He added that there is also a lack of infrastructure for compliance compared to systems for traditional assets.
However, he predicts there will be “billions of dollars of interest waiting to be incorporated” when regulators finally approve cryptocurrencies as a class of institutional assets.
Specifically, for bitcoin, if regulators allow financial services companies to treat it as an asset and approve exchange-traded funds based on bitcoins in the United States, it sees the purchase of cryptocurrency worth “more than trillions of dollars “.
“This is not going to go away, this is the new asset class,” he said.
Scarce on airlines
O’Leary also said he is betting on airlines because “business trips will never return to what they were” before the pandemic hit.
“I think the business travel side of the airlines business is horribly bad and I’m making money in the absence of airlines,” he said, referring to a trading technique in which investors take shares of a stock. from an agent and sell them, hoping to be able to buy them back at a lower price.
“It’s not that I don’t like airlines, but I think they’re in bad business.”
Airlines have been attacked by border closures and travel restrictions since last year, when Covid first struck. They have suffered from uncertainty as the virus increased and decreased in different parts of the world.
“It’s bad, bad, bad business. Not just because of pandemics, because people don’t need to fly,“ He said.
– CNBC’s MacKenzie Sigalos and Arjun Kharpal contributed to this report.