Morgan Creek Digital Bets $1 Million That Crypto Will Outperform S&P 500 Over Next 10 Years
Institutional fund manager Morgan Creek Digital just made a bold bet on the crypto industry. The money manager is betting $1 million that crypto assets will deliver a superior ROI to the S&P 500 over the next 10 years.
Morgan Creek Digital issued the challenge earlier today. The challenge is targeted towards traditional money managers who believe cryptocurrencies are “worthless” or that traditional stocks like the S&P 500 will always deliver better returns on investment.
Anyone who wants to take the challenge can lock-in their money by investing in the Digital Asset Index Fund, a crypto index fund managed by Bitwise Asset Management.
You may recall that in 2008, famous money manager Warren Buffett made a similar bet. Buffett bet that investing in an S&P 500 index fund at the time would deliver a greater result than investing in hedge funds. Earlier this year, Buffett officially won that bet, indicating that investing in a basket of funds passively was superior to investing in an actively-managed fund.
Now, Morgan Creek Digital is making a similar bet, claiming that returns on crypto will exceed returns on the S&P 500 over the next decade.
The Bet Includes The Top Cryptocurrencies By Market Cap
Morgan Creek Digital’s bet specifically covers the following top cryptocurrencies:
- Bitcoin (BTC)
- Ethereum (ETH)
- Bitcoin Cash (BCH)
- EOS (EOS)
- Litecoin (LTC)
- Monero (XMR)
- ZCash (ZEC)
- Dash (DASH)
- Iota (IOTA)
- NEM (XEM)
As you can see, not all of these cryptocurrencies are in the top 10 by market cap. Nevertheless, Morgan Creek Digital believes that investing in the cryptocurrencies above will deliver superior returns on investment to investing in the S&P 500.
“It outperformed over the last 10 years and we believe that will not change moving forward for the next 10 years,” explained Morgan Creek Digital founder and partner Anthony Pompliano in a statement to CoinDesk discussing the bet.
Pompliano was quick to add that the firm is not basing future expectations on past performance – one of the greatest fallacies to make as a money manager.
Instead of basing crypto’s future growth on past performance, Pompliano referenced a post highlighting bitcoin’s fundamentals, including its potential for huge growth as an asset classes. Clearly, Pompliano and Morgan Creek Digital believe that we’re on the cusp of bitcoin becoming great.
Will Anyone Take The Bet?
Will anyone take up Pompliano’s bet? It remains to be seen.
However, there are certainly a large number of “bears” in the traditional financial space who believe crypto assets will inevitably fall to 0. Warren Buffett, who has become famous for his bets in the past, has previously indicated something similar, for example.
These individuals have talked a big game on mainstream media outlets where they have repeatedly trashed bitcoin and crypto investors. Could Warren Buffett take this crypto bet and put his money where his mouth is? It’s certainly possible.
The bet is scheduled to begin on January 1, 2019 and conclude in 2029.