Billionaire Thomas Peterffy Backs Bitcoin, Advises 2%-3% Net Asset Allocation for Safety

• Billionaire Thomas Peterffy recommends holding 2%-3% of net assets in Bitcoin, citing its potential despite high volatility.
• Interactive Brokers launched crypto trading in 2021, offering Bitcoin, Ethereum, Litecoin, and Bitcoin Cash through Paxos Trust Co.
• Peterffy warns Bitcoin lacks intrinsic value but sees it as essential for portfolio diversification in small allocations.

Thomas Peterffy, the billionaire founder of Interactive Brokers Group, has advised investors to allocate 2% to 3% of their net assets to Bitcoin. Despite his cautionary stance on cryptocurrencies, Peterffy acknowledged the potential benefits of limited exposure to digital assets. Speaking during a financial conference, he emphasized the need for prudence, warning against investing over 10% of one’s portfolio in Bitcoin due to its volatile nature.

Peterffy described Bitcoin as lacking intrinsic value, comparing it to paper currency, which he believes holds no real worth. Still, he stressed the importance of owning a small amount, stating, “Anyone without Bitcoin should own some, but not too much.” This perspective aligns with his cautious approach to high-risk investments.

Early Skepticism and Gradual Acceptance of Bitcoin

Initially a vocal critic of Bitcoin, Peterffy expressed concerns about its impact on the broader economy. He warned that cryptocurrencies could destabilize traditional markets if not carefully managed. In 2021, as the CME prepared to launch Bitcoin futures, he maintained his skepticism, urging a clear separation between cryptocurrencies and the real economy.

Despite his reservations, Peterffy began dabbling in cryptocurrencies in mid-2021, investing a modest sum. He explained that his decision was based on the slim chance that Bitcoin could emerge as a dominant global currency. He stated, “Even though chances are low, you have to play the odds.” This cautious optimism reflects his balanced view of the asset’s potential and risks.

Interactive Brokers and Cryptocurrency Expansion

Interactive Brokers, under Peterffy’s leadership, launched cryptocurrency trading in 2021. The platform allows users to trade Bitcoin, Ethereum, Litecoin, and Bitcoin Cash through a partnership with Paxos Trust Co. This was a shift for the brokerage, which initially avoided cryptocurrencies due to their perceived instability.

Peterffy also commented on the resilience of Bitcoin following the collapse of the FTX crypto empire in November. He noted that the downturn was less severe than anticipated, demonstrating the market’s unexpected stability. However, he remains wary of overexposure to digital currencies, advising investors to stay cautious amid ongoing volatility.