Most people probably don’t know who Ricardo Salinas is. But if you want to be a successful investor, especially in cryptocurrencies, he is a man you should watch. He didn’t become a billionaire for no reason. And right now, he is going all-in on the most popular cryptocurrency.
This billionaire loves this cryptocurrency
What’s the preferred cryptocurrency of Ricardo Salinas? The answer has to be Bitcoin (BTC -0.31%). When you learn what Salinas thinks about it, you’ll immediately know why.
When it passed the $77,000 mark, Salinas went on social media stating his earlier prediction on the coming appreciation of Bitcoin turned out to be right. But he also said that there’s still more time to buy the cryptocurrency, implying a rally that will continue to power ahead. Now Bitcoin has crossed the $100,000 mark.
Could there be a more bullish take on Bitcoin and its long-term value? You should know that Salinas is putting his money where his mouth is. Nearly five years ago, he claimed that almost 10% of his liquid assets were invested in Bitcoin.
Since that time, its price has risen by roughly 1,000%! Think Salinas is cashing out? Think again. He continues to see Bitcoin as a powerful hedge against economic volatility. Given that he is from Latin America, Salinas probably understands better than most people how inflation and fiat currency devaluation can kill a portfolio. Bitcoin, he believes, is the best antidote to these ever-present challenges.
Historically, the more traditional hedge against economic uncertainty has been gold. It currently has a market cap of around $18 trillion, while the crypto’s market cap still hovers around $2 trillion. As a store of value alone, then, Bitcoin still has plenty of potential upside versus gold.
Salinas certainly views things that way. Earlier this year, he stressed that the digital token has “extraordinary properties,” calling it “gold for the modern world.”
Should you add more Bitcoin to your portfolio right now?
While estimates vary, Salinas currently has a total net worth somewhere around $10 billion. And while we don’t know exactly how many bitcoins he owns, based on his past statements, it’s reasonable to assume that his stake is worth somewhere in the tens of millions of dollars — perhaps even in the hundreds of millions.
And given that he urged his family and followers to load up on it as recently as last summer, it’s reasonable to assume he’s still holding strong, especially since his investment thesis is based on long-term factors that won’t dissipate anytime soon.
Should you load up your own portfolio with Bitcoin? Before you do, note that even Salinas — one of the richest, most vocal bulls for it on the planet right now — still has just a minority of his wealth tied up in Bitcoin. He has allocated a lot more of his money to the cryptocurrency than most major investors, but he’s not betting the house.
The same should likely be true for your portfolio. More and more investors are realizing that they should have a greater exposure to crypto. Yet, the characteristics of this investment are far different from most traditional investments, especially when it comes to custody and volatility.
I’ve long believed that Bitcoin provides an incredible store of value, equal to that of gold. So using gold’s market cap — which is nearly 10 times the crypto’s current market cap — provides a strong case for holding the digital currency over the long term.
Yet its value has plunged by 80% or more on quite a few occasions. So while the long-term upside is there, don’t invest any funds you’ll need near-term access to.
I believe Salinas is right: more people will invest in Bitcoin. However, it’s still critical to research what you’re actually going to buy. In addition, it’s important to keep your allocations reasonable. Expect significant volatility, but be prepared to hold for the long term.
