This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Hedge Fund Manager Says It's Time to Make a Bet on Bitcoin

By Hal M. Bundrick

NEW YORK (MainStreet) It may be time to make a bet on bitcoin. At least one Wall Street hedge fund manager thinks so. Michael Novogratz, co-chief investment officer of the Fortress Investment Group, made the surprising call at a UBS investor forum in New York this week, according to the Financial Times. He is perhaps the highest-profile Wall Street investor to endorse the crypto currency as an investment.

Bitcoin is an open-source method of payment that uses peer-to-peer technology to complete transactions. It has been called "cash for the Internet."

When asked to offer his best investment idea for the coming year, Novogratz said, "Put a little money in bitcoin. Come back in a few years, and it's going to be worth a lot."

In fact, Bitcoin has doubled in value in just the last few weeks, following the raid by the U.S. Department of Justice on Silk Road earlier this month, and online black market that was a major global player in bitcoin merchant transactions.

Novogratz said that he and a colleague took positions in bitcoins three months ago, but wouldn't say how much he has invested in the digital currency, though he did admit it was "Enough that I am smiling that it has doubled."

Fortress has not made an investment in the currency for its portfolios, deciding it was too speculative.

A division of the Chinese Internet service Baidu began accepting bitcoin payments October 14th, which spurred increased trading in the currency. A Chinese bitcoin exchange, BTC China, is now the third largest trading platform, based on 30-day volume, according to Bitcoinity.org.

Online exchange Mt.Gox reports bitcoin has been trading at highs well over $200 this week. It is the second time this year that the currency has traded at such a level.

Jason Williams, founder of BitPOS, a bitcoin exchange, told ZDNet this week that as the bitcoin price soars, investors are beginning to be concerned with a possible market bubble.

--Written by Hal M. Bundrick for MainStreet

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $123.25 0.00%
FB $83.30 0.00%
GOOG $548.34 0.00%
TSLA $185.00 0.00%
YHOO $45.10 0.00%

Markets

DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs