Today Warren Buffet's Berkshire Hathaway has made a $500 million investment in the parent company of the privately-held digital bank Nubank, which has been offering cryptocurrency investment products to its users.
According to CNBC, Nubank is a private bank based in Brazil that was founded in 2013, and has roughly 40 million customers. The company's CEO has revealed an initial public offering is currently being planned, but is a likely possibilty in the future.
The $500 million investment is notable, as Buffet is a well known bitcoin critic, who has in the past called the cryptocurrency a 'gambling device' and argued they are worthless because they dont produce anything. The investor has made a similar case against Gold.
https://twitter.com/Blockworks_/status/1402253863000940544?s=20
The digital bank notably acquired Easynvest, a digital investment platform, late last year. The platform allows anyone to invest without paying commissions, and offer its users access to bitcoin exchange-traded funds and products, including 3iQ's QBTC bitcoin investment product.
Berkshire Hathaway has notably made significant investments in financial firms in the past with traditional banks and insurance firms making up a large portion of its portfolio. IN the first quarter of the year, however, Buffet had sold already his stake in WELLS FARGO.
2. TEXAS STATE ALLOWS BANKS TO BUY BITCOIN
On june 10 2021, a notice from Texas Department of Banking told state chartered banks they can work with crypto companies.
This news is not representative of new law , but affirmation that state-chartered banks are allowed to provide crypto custody as long as their are required protocols in place and the banks are complying with existing legal frameworks.
Custody services may differ depending on each banks's expertise risk apetite and business model. Banks may offer fiduciary and non-fiduciary, which could range from safely storing copies of a customer's private keys to directly controlling crypto assests, including holding private keys on behalf of its customers.
BUT WHY THIS STEP ? AND WHY NOW?
To answer this MARCUS , assistant general counsel at the Texas Department of Banking " Both at the state and federal regulatory agencies , we are seeing a rise in the virtual currency industry as it continues to evolve. WE expect our baks to start seeing demand from their customers and we want them to be prepared for that"
Sources: 1. cryptoglobe 2. coindesk