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Legendary investor Bill Miller has set up his flagship fund to buy into Grayscale Bitcoin Trust

Feb 8, 2021, 23:17 IST
Business Insider
Bill Miller.Heidi Gutman/CNBC/NBCU Photo Bank/NBCUniversal/Getty Images
  • Legendary investor and noted bitcoin bull, Bill Miller, is now allowing his flagship fund to buy into bitcoin via the Grayscale Bitcoin Trust.
  • Miller's $2.7 billion fund, the Miller Opportunity Trust, is in the top 2% of all funds in terms of performance over the past five years.
  • Grayscale Bitcoin Trust continues to outperform as cryptocurrencies resume their surge.
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Legendary investor and noted Bitcoin bull Bill Miller endorsed cryptocurrencies yet again on Monday. SEC filings revealed Miller set up his flagship fund, the Miller Opportunity Trust, to invest in Grayscale Bitcoin Trust to gain exposure to the cyrptocurrency market.

"The Fund may seek investment exposure to bitcoin indirectly by investing in the Grayscale Bitcoin Trust, an entity that holds bitcoin," management wrote in an SEC filing.

Miller has long been one of the top-performing hedge fund managers on the planet, outperforming the market for an incredible 15 straight years.

His $2.7 billion Miller Opportunity Trust has a five-year return that puts it among the top 2% of all funds, according to data from Bloomberg.

Read more: RBC says to buy these 15 stocks as small companies keep dominating the market - and details why each is a top pick for 2021

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A move into bitcoin may help Miller's winning streak continue. However, the trust will have some restrictions on exposure to crypto markets.

"The Grayscale Bitcoin Trust invests principally in bitcoin. The Fund will not make any additional investments in the Grayscale Bitcoin Trust if, as a result of the investment, its aggregate investment in bitcoin exposure would be more than 15% of its assets at the time of investment," SEC filings reveal.

Miller's move to target the Grayscale Bitcoin Trust for crypto exposure comes as Grayscale continues to outperform. The trust has been an outstanding investment for many institutional and retail buyers, returning 229.11% over the last 12 months and 119% over the last three months.

And it looks like the outperformance is set to continue after Bitcoin pushed to all-time highs of over $44,000 on Monday, buoyed by Tesla's $1.5 billion investment in the digital asset and news the EV giant may accept payments in the bitcoin in the future.

Read more: Bank of America says investors might start selling stocks and buying bonds sooner than expected. Here's when it could happen, and what to own for maximum income if yields keep rising.

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The move into bitcoin is in line with Bill Miller's position on cryptocurrencies over the years. Miller has been a Bitcoin bull for some time. He once even sparred with Warren Buffett over the cryptocurrency after Buffett called it "rat poison."

"Warren Buffett famously called Bitcoin 'rat poison,'" Miller said. "He may well be right. Bitcoin could be rat poison, and the rat could be cash." Miller added Bitcoin is "best thought of as digital gold."

So far, Miller's predictions for digital currencies have been correct. In November of 2020 he said, "the current relative trickle into Bitcoin" is set to "become a torrent" if more companies swap cash for crypto. His comments came months before Tesla announced Monday in SEC filings that it has invested $1.5 billion and will soon accept the token as payment, sending bitcoin to fresh highs above $43,000.

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