Morgan Creek Capital Management is recreating the famous 'Million Dollar Bet,' originally done by business magnate Warren Buffett.
The cryptocurrency asset manager is betting AGAINST the S&P 500 and throwing all its eggs into the proverbial cryptocurrency basket, choosing a handful of crypto hedge funds to follow up on. They have faith that the performance of the crypto market over the next 10 years will prevail, in a challenge they call "Buffett Bet 2.0."
The asset firm challenges anyone who believes that the S&P will deliver more positively on returns compared to their chosen cryptocurrencies over the next decade, to take on the other side of the wager. Anthony Pompliano, co-founder and partner at Morgan Creek Digital, told CNBC that whoever takes the opposite end of the bet will likely be someone who echoes Buffett’s sentiments on the cryptosphere, thinks that crypto is overvalued and worthless, or is bullish on the S&P.
Pompliano stated that the decision that resulted in the bet "is a combination of our outlook not only for the upside of cryptocurrencies but also the outlook on public equities." He further explained, "A lot of people might look at this and just think we're bullish on crypto – but you need to look at what asset we're going up against. Public equities aren't exactly at their all-time highs either."
Buffett, who is outspoken about his distaste for crypto, having previously called Bitcoin 'rat poison squared,' used his own money in his original bet. He wagered that an investment in the S&P 500 would do better than five chosen, actively managed hedge funds. The billionaire was correct and won that in 2017.
Just as Buffett did, Morgan Creek partners participating in the bet are personally providing their side of the one-million-dollar wager, the report explained. No participant has yet to take on the challenge and hold the opposing side of the daring wager. Pompliano’s intention for the cash is that the winning side donates it to charity.
Update: Anthony Pompliano announced via Twitter that Morgan Creek has had no takers on the daring bet as of yet.
We issued a $1 million challenge to any professional money manager who thought stocks would outperform crypto over the next decade.— Pomp 🌪 (@APompliano) December 15, 2018
No one took us up on the offer.
Don’t listen to the naysayers. They don’t even believe what they say.
Always follow the money 👊🏽