Warren Buffett invests $1B in Bitcoin-friendly neobank, dumps Visa and Mastercard stocks
Warren Buffett reduces exposure to Visa and Mastercard.

Warren Buffett's Berkshire Hathaway dumped a portion of its Visa and Mastercard holdings and increased exposure in Nubank, the largest fintech bank in Brazil that's also popular among the country's Bitcoin investors.

In a securities filing late Feb. 14, the industrial conglomerate disclosed that it had purchased $1 billion worth of Nubank Class A stock in Q4/2021. On the other hand, it sold $1.8 billion and $1.3 billion worth of Visa and Mastercard stock, respectively, signaling a shift away from credit companies to gain exposure in their fintech rivals.

Buffett, the so-called "Oracle of Omaha," is popular for his cautious approach to investing, particularly in the market's hottest sectors such as fintech. The veteran investor had also downplayed emerging decentralized finance solutions like Bitcoin (BTC), ridiculing it as an asset that "does not create anything."

But Berkshire's new stake in Nubank shows that Buffett has been softening up to fintech lately. In detail, the firm had invested $500 million in the startup in July 2021. Its returns on the said investment amounted to $150 million in December 2021 after Nubank debuted on the New York Stock Exchange (NYSE).

Bitcoin price dips below $38K as crypto sentiment nears ‘extreme fear’
BTC price action stays below $40,000 after a geopolitics-inspired rout sends Bitcoin to multi-week lows.

Bitcoin (BTC) saw its first dive below $38,000 in over two weeks on Feb. 20 as macro triggers rattled low-volume weekend markets.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD losing ground Sunday, following threats of fresh sanctions on Russia over its alleged plans to invade neighboring Ukraine.

After a quiet Saturday, crypto began to move downhill after comments from United Kingdom Prime Minister Boris Johnson on financial blocks of Russian firms should the situation escalate. These would be prohibited from "trading in pounds and dollars," the BBC reported Johnson as saying Sunday morning, alluding to support from United States President Joe Biden.

With crypto the only markets constantly open, the reaction to geopolitical fears in the region could foreshadow a greater knock-on effect next week as traditional markets open. Monday is a holiday on Wall Street.

Commenting on the situation, Mike McGlone, chief commodity strategist at Bloomberg Intelligence, additionally drew attention to the ongoing issue of inflation and its relationship to risk asset performance.

In line with previous comments, however, he suggested that ultimately, Bitcoin could profit from the sea of change in U.S. economic policy this year.

"Bitcoin indicating a rough week ahead - Inflation Unlikely to Drop Unless Risk Assets Do: Most assets are subject to the ebbing tide in 2022, on the inevitable reversion of the greatest inflation measures in four decades, but this year may mark another milestone for Bitcoin," he argued.

Among Bitcoin traders, short timeframes were now equally lackluster, with the loss of $40,000 weighing on sentiment.

Bitcoin inactive supply nears record as over 60% of BTC stays unspent for at least 1 year
Bitcoin returns to near 61% inactive supply for a year or more after a gap of nearly two years.

Bitcoin (BTC) may be struggling at $40,000 but fresh data is reinforcing the fact that hardly anyone is interested in selling. Data from on-chain analytics firm Glassnode shows that despite price volatility, over 60% of the BTC supply has not left its wallet in a year or more.

Stubborn hodling by long-term investors is a characteristic that differentiates the current Bitcoin market climate from most other downtrends. With spot price action passing 50% losses versus November's all-time highs last month, expectations were for cold feet to kick in — but among seasoned hodlers, the sell-off never came.

In fact, the opposite has been true for an extended period — long-term investors are adding to their positions or staying put on their BTC exposure. According to Glassnode's HODL Waves indicator, as of Feb. 18, 60.61% of the BTC supply has not been used in a transaction for a year or more.

Bitcoin HODL Waves chart (screenshot). Source: Unchained Capital

The figure is significant — only twice before in Bitcoin's history has the one-year-or-more value reached that level. As noted by entrepreneur and investor Alistair Milne, both occasions followed a downtrend and preceded a major bounceback in Bitcoin price action.

There have only been two occasions where 1yr+ HODL'ing of #Bitcoin has been higher (currently 61%).

Early 2016, price $380-450 range
Mid-2020, price ~$9000

Both times were during a prolonged consolidation before a huge bull move February 18, 2022

As such, the odds are on for an altogether different trend to form for Bitcoin in the mid-term, this potentially defying the broadly gloomy narrative over flagging macro support, rising interest rates and geopolitical tensions.

"Long term HODL'ers patiently HODL'ing because they know what's likely coming soon," Philip Swift, analyst at trading suite Decentrader, added about the data.

This Daily Dose was brought to you by Cointelegraph.

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