Bitcoin plunged nearly 65% in 2022. But one billionaire investor still likes the world’s largest cryptocurrency: Mark Cuban.
“I want Bitcoin to go down a lot further so I can buy some more,” Cuban said in a recent episode of Bill Maher’s Club Random podcast.
Maher, who self-claims to be “very anti-bitcoin,” owns gold instead. Cuban, conversely, has no time for the yellow metal.
“If you have gold, you’re dumb as f—,” says the Shark Tank star and Dallas Mavericks owner.
Maher argues that gold “is like a hedge against everything else” but Cuban disagrees.
“[Gold] is not a hedge against anything, right? What it is is a store of value and you don’t own the physical gold, do you … Gold is a store of value and so is Bitcoin,” Cuban explains.
He then points out why gold can’t really protect your wealth in times of crisis.
“You don’t own the gold bar, and if everything went to hell in a handbasket and you had a gold bar, you know what would happen? Someone would beat the f— out of you or kill you and take your gold bar.”
If you share Cuban’s view, here are a few ways to gain exposure to bitcoin.
Buy bitcoin directly
The first option is the most straightforward: If you want to buy Bitcoin, just buy Bitcoin.
These days, many platforms allow individual investors to buy and sell crypto. Just be aware that some exchanges charge up to 4% commission fees for each transaction. So look for apps that charge low or even no commissions.
While bitcoin commands a five-figure price tag today, there’s no need to buy a whole coin. Most exchanges allow you to start with as much money as you are willing to spend.
Bitcoin ETFs
Exchange-traded funds have risen in popularity in recent years. They trade on stock exchanges, so buying and selling them is very convenient. And now, investors can use them to get a piece of the bitcoin action, too.
For instance, ProShares Bitcoin Strategy ETF (BITO) started trading on NYSE Arca in October 2021, marking the first U.S. bitcoin-linked ETF on the market. The fund holds bitcoin futures contracts that trade on the Chicago Mercantile Exchange and has an expense ratio of 0.95%.
Investors can also consider the Valkyrie Bitcoin Strategy ETF (BTF), which made its debut a few days after BITO. This Nasdaq-listed ETF invests in bitcoin futures contracts and charges an expense ratio of 0.95%.
Bitcoin stocks
When companies tie some of their growth to the crypto market, their shares can often move in tandem with the coins.
First, there are bitcoin miners. The computing power doesn’t come cheap and energy costs can be substantial. But if the price of bitcoin goes up, miners like Riot Blockchain (RIOT) and Hut 8 Mining (HUT) are likely to receive increased attention from investors.
Then there are intermediaries like Coinbase Global (COIN) and PayPal (PYPL). When more people buy, sell and use crypto, these platforms stand to benefit.
Finally, there are companies that simply hold a lot of crypto on their balance sheets.
Case in point: enterprise software technologist MicroStrategy (MSTR). It has a market cap of under $2 billion. Yet its bitcoin count reached approximately 132,500 as of Dec. 27, 2022, a stockpile worth around $2.3 billion.
Source: finance.yahoo.com