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Ruffer Investment cashes out $1B profit from $600M BTC buy in November

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The British asset management company Ruffer Investment, which bought $ 600 million worth of Bitcoin back in November, reported that its BTC reserves were completely sold, and the total profit exceeded $ 1.1 billion.

London-based investment managers from Ruffer invested in BTC back when the price of one coin was in the region of $ 10,500. In February, the company sold 40% of the Bitcoins it bought to lock in some of the profits. However, the situation for the company continued to develop positively. And in April Ruffer’s management decided to completely close the position. The time was chosen well, because it was on April 14 that the rate of the first cryptocurrency peaked at $ 64,850.

The British firm partially explained the sale of the asset by the fact that in the face of the lifting of the restrictions associated with the pandemic, young people will no longer spend a lot of time on trading.

Ruffer channeled the proceeds from the sale of BTC into “promising” assets, for example, into inflation-indexed government bonds. Bailey expects inflation to rise faster than interest rates, as the authorities are reluctant to raise the latter due to the high debt burden. As a result, there is a strong incentive to switch to indexed bonds to protect capital from depreciation.

However, according to Hamish Baillie, Ruffer’s investment director, the company can re-purchase BTC at a convenient opportunity.

The impact of Bitcoin on the environment

Ruffer’s investment director also expressed his opinion on the environmental impact of Bitcoin. He said that all this too exaggerated. 70% of the energy for mining taken from renewable sources, and the consumption itself is not so great – the gaming industry consumes much more.

BTC has tremendous benefits

In addition, he noted that BTC carries enormous social benefits. “Western currencies are relatively stable, but imagine if you held Bitcoin for the past 10 years and lived in Venezuela. It has become a wonderful store of value outside the monetary system. It can also be used to transfer money across borders, which is useful, especially in developing countries”.

At the beginning of the year, analysts at Ruffer Investments said that institutional investors are increasingly investing in Bitcoin. And the trend will continue in the coming years.

Recall that earlier the purchase of Bitcoin in the company called insurance “against the devaluation of world currencies”. Ruffer initially allocated 2.5% of its portfolio to cryptocurrency. Ruffer made BTC purchases through One River Digital and Coinbase.

Though like most companies, the London-based asset management firm only recently changed its stance on Bitcoin. Back in 2017, the company was skeptical about the digital asset.

Sale of Bitcoins by Tesla

Note that at the end of the first quarter, Tesla also announced that it made approximately $ 100 million in profits from the sale of BTC. At the time, CEO Elon Musk said the deal aimed at testing its liquidity. While the community was skeptical, Musk confirmed that Bitcoin proved to be liquid, further cementing its position as an alternative to cash. Tesla still has $ 1.5 billion on its balance sheet.