Warren Buffett’s Berkshire Hathaway has invested $ 500 million in Brazilian digital bank Nubank. The deal is a continuation of the series G investment round. Which held in January this year, according to a statement on the website of the financial institution. In early June, Nubank acquired the broker Easynvest and two other companies that offer clients investments in digital assets and Bitcoin traded funds.
The funds raised company will use to expand the international activities of the bank. As well as to attract new leaders from large technology companies. In addition to Brazil, Nubank also operates in Colombia and Mexico. Together, these three countries account for 60% of Latin American America’s GDP. According to the press service of the bank, about 50% of the region’s population doesn’t have bank accounts, and an average of 21% of residents of these countries use credit cards. Nubank CEO David Velez said the funding would help “democratize access to financial services” in Latin America.
Berkshire’s Class B stock has remained largely unchanged since the announcement.
Nubank is a digital bank and the largest fintech company in Latin America. It provides clients with the opportunity to obtain a digital account, international credit card, loan, life insurance, and invest funds.
Nubank CEO and founder David Velez said the bank no longer plans to raise capital and conduct an initial public offering (IPO), although he admitted that Nubank will go public at some point.
According to Velez, the bank intends to continue to expand, especially in the investment and insurance market in the three countries where it already operates. The CEO of Nubank noted that organic growth is the main goal. But he didn’t deny the possibility of asset acquisitions.
Buffett’s position on cryptocurrency
Buffett has repeatedly criticized the cryptocurrency. The investor pointed out that digital assets don’t produce anything and have no fundamental value. But are a record in a distributed ledger, and one can only hope that someone will buy it in the future.
Buffett also said that buying a cryptocurrency can be called speculation or gambling, but definitely not an investment.
Berkshire Vice Chairman Charlie Munger also called the cryptocurrency “useful to thieves and ransomware”. It should be noted, though, that over the past year, the multinational conglomerate has invested in many technology companies and beyond, including cloud company Snowflake. This suggests that Berkshire Hathaway is more open to this idea than its billionaire owner.
Buffett is no stranger to investing in financial companies. As traditional banks and insurance companies make up a significant portion of Berkshire’s investment portfolio.
As we can see, over time, his position regarding the cryptocurrency also became less categorical. And his company has already been noticed more than once in investing in projects related to cryptocurrency.
Buffett’s half a billion will help spread real cryptocurrency-covered stocks across Latin America. It turns out that Buffett very timely invested in Nubank, which can become the flagship of Bitcoin distribution among the general population in the person of its customers, starting with cryptocurrency-backed shares.