Investment Manager John Paulson Says Cryptos Will Prove To Be ‘Worthless’
It’s a pretty sure bet that billionaire John Paulson won’t be joining fellow billionaires Mark Cuban and Elon Musk on the cryptocurrency bandwagon anytime soon.
See: Mark Cuban Owns Less Than $500 in Dogecoin Despite Team’s Stake in the Crypto
Find: Yes, You Can Buy a Tesla with Dogecoin – Only Not from Tesla Itself
During an interview with Bloomberg TV on Monday, Paulson called crypto “a limited supply of nothing,” Blockworks reported. The founder of New York-based investment management firm Paulson & Co. didn’t stop there, either.
“Cryptocurrencies, regardless of where they’re trading today, will eventually prove to be worthless,” Paulson said during an episode of Bloomberg Wealth with David Rubenstein. “Once the exuberance wears off, or liquidity dries up, they will go to zero. I wouldn’t recommend anyone invest in cryptocurrencies.”
Paulson has experience with overhyped assets. He grabbed headlines in 2007 when he used credit default swaps to bet against the U.S. subprime mortgage loan market. Because of those bets, the funds Paulson ran raked in $15 billion that year, while he came away with an estimated $4 billion.
Paulson said during the Bloomberg interview that his firm shorted subprime because the upside far outweighed the downside. However, he also said that crypto is too volatile to short.
“In crypto, there’s unlimited downside,” he said. “So even though I could be right over the long term, in the short term, I’d be wiped out.”
Paulson’s view of crypto is in stark contrast to that of other billionaires. Paul Tudor Jones, founder and CIO of Tudor Investment Corporation, said in June that Bitcoin offered a good way to combat inflation and diversify portfolios. He recommends allocating 5% of a portfolio to Bitcoin.
And as GOBankingRates previously reported, both Tesla CEO Elon Musk and Dallas Mavericks owner Mark Cuban have offered a bullish take on Dogecoin.
See: Comparing Dogecoin, Baby Doge and Shiba Inu: Is There One To Watch?
Find: AMC To Accept Bitcoin by Year’s End, but Some Experts Aren’t Sold on the Concept
Meanwhile, a survey published by Intertrust Group found that about one in six hedge fund managers expect to invest more than 10% of their investment holdings in cryptocurrencies over the next half-decade.
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This article originally appeared on GOBankingRates.com: Investment Manager John Paulson Says Cryptos Will Prove To Be ‘Worthless’
