How Warrent Buffet’s purchase of gold might cause BTC price reach 50K

Warren Buffett’s Berkshire Hathaway sold some of his assets aiming to buy gold mining company. Based on investors’ opinion such actions will cause the BTC price boost.

Berkshire Hathaway, the $503 billion corporation directed by Warren Buffett, sold Goldman Sachs for a Canadian gold company Barrick Gold. Based on the opinion of Max Keiser, the founder of Heisenberg Capital and an early Bitcoin investor, such deal might help BTC to grow till the level of $50,000.

Based on Fortune report the quarterly report of Berkshire Hathaway shareholders confirmed that Buffet has cut his position in most of the major banks. The company has sold the significant part of his stocks in JPMorgan Chase, Wells Fargo and PNG.

Buffett’s idea of a complete closure Berkshire’s position on Goldman Sachs had been done after the bank has obtained a return amounting to $13.3 billion. It might bring an idea that Buffet got tired from being the first one in the banking industry for the long period of time.

Next time Buffer bought some share in Barrick Gold the company which is popular for gold. This gold mining company is based in Canada, where the level of gold extraction has been increased for 45%. After Berkshire’s investments the company shares value has been increased by 8.11% in after-hours trading.

According to Max Keiser, an avid Bitcoin investor who has invested in companies like Kraken and Bitfinex, the Buffett’s gold investment could benefit Bitcoin popularity as positive attitude towards gold prompts BTC price growth

“Global $100 trillion fund management biz is less than 1% invested in Gold. With Buffett now moving into Gold. Expect global allocation of 5% AU min. Implies $5,000 Gold. Expect a 1% BTC global allocation ($1 trillion). This implies $50,000 for Bitcoin Expect PTJ ups to 10%.”

 

The weekly price chart of Bitcoin. Taken from: TradingView.com

A former L/S company portfolio manager and Ikigai Fund founder Travis Kling confirms this idea.  Reminding Buffett’s sceptisism about the gold on 1998, Kling mentioned:

“Today it was announced Berkshire Hathaway just bought its first gold stock ever. The reasons are self-apparent at this point. Just in case you’re wondering what the coming years are going to look like for Bitcoin, this was Buffett on gold in 1998.”

BTC has shown some correlation with the precious metal

Despite the BTC higher rates in comparison to gold since April, the price trend between gold and BTC has shown some correlation.  The data below confirm that both assets had been increased in prise within recent four months.

The correlation between Bitcoin and gold. Taken from : Skew.com

Such price charts since late March make more investors to consider BTC as valuable asset

Recently, MicroStrategy, a $1.4 billion intelligence company bought BTC for the sum of 250 million USD for company assets refilling.

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