Peter Thiel appears to be betting big on bitcoin: Founders Fund, the venture capital firm he co-founded, has accumulated hundreds of millions of dollars of the cryptocurrency.
Citing sources familiar with the matter, The Wall Street Journal reports that the Founders Fund has purchased $15 million to $20 million in bitcoin and has told investors it is now worth hundreds of millions of dollars. In fact, the bitcoin investment is already estimated as the most valuable in Founders’ most recent $1.3 billion venture fund.
Founders Fund and Thiel have been early investors in companies like Facebook, Airbnb, SpaceX and Lyft. Recent investments include the crypto-focused hedge funds MetaStable Capital and Polychain Capital.
Bitcoin had a meteoric rise in 2017, starting at around $1,000 and reaching almost $20,000 in November. It traded at $14,292 on Friday, up 1,375 percent on the year.
But concerns over volatility, cybersecurity and liquidity have scared away many mainstream investors. On December 22, investor Michael Novogratz said he was delaying the launch of a crypto-focused hedge fund because “we didn’t like market conditions for new investors.”
Founders began buying bitcoin before the recent volatility, and, according to sources, the company has told clients that the investment is a high-risk, high-reward bet. While bitcoin could multiply several times over in the coming years, the company has also warned that the digital currency could end up being worth nothing — or close to it.