Warren Buffett, long regarded as one of the most vocal critics of cryptocurrency, has quietly reaped over $285 million in gains from an investment deeply intertwined with the digital asset ecosystem. Despite repeatedly calling Bitcoin “rat poison squared” and vowing never to own any crypto, Buffett’s firm, Berkshire Hathaway, has profited handsomely from its stake in Nu Holdings, the parent company of Brazil-based neobank Nubank—a financial platform actively expanding into cryptocurrency services.
This apparent contradiction reveals a nuanced investment strategy that aligns with Buffett’s core principles: investing in businesses he understands, with strong fundamentals, sustainable growth, and clear competitive advantages—even when they operate at the edge of emerging technologies.
A Digital Bank with Crypto Ambitions
Nu Holdings, founded in 2013, is a leading digital banking platform serving customers across Brazil, Mexico, and Colombia. As of Q3 2024, it boasts 109.7 million global customers, up from 89.1 million in the same period in 2023—an increase of 5.2 million users in just one quarter. Its revenue surged 56% year-over-year to $2.9 billion, while average monthly revenue per active customer grew by 25%.
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While Nubank started as a challenger bank offering no-fee credit cards and mobile-first banking, it has evolved into a tech-driven financial ecosystem. In May 2022, it launched Nubank Cripto, a cryptocurrency platform integrated directly into its app. Initially supporting Bitcoin (BTC), Ethereum (ETH), and Polygon (MATIC), the platform later added Uniswap (UNI) and Chainlink (LINK). It also enables users to send, receive, and convert stablecoins like USDC, and even offers yield-generating features.
In September 2022, Nubank minted its own token—Nucoin—on the Polygon blockchain. By November 2023, it introduced a low-fee crypto exchange tool allowing users to swap BTC, ETH, SOL, or UNI for USDC. Most recently, Nubank expanded its 4% annual yield program on USDC holdings to all Brazilian users with a minimum balance of 10 USDC—further blurring the line between traditional banking and decentralized finance.
Berkshire Hathaway’s Calculated Bet
Berkshire Hathaway first invested $500 million** in Nu Holdings during its **Series G funding round in June 2021**, well before Nubank announced its crypto ambitions. It followed up with an additional **$250 million investment after Nu’s IPO in December 2021, bringing its total stake to approximately 107 million shares.
Although Berkshire reduced its holdings to 86.4 million shares by Q3 2024—a nearly 20% reduction—the investment has been highly profitable. With Nu Holdings’ stock price rising from its IPO levels to a high of $16.145 and currently trading at **$11.99 (a 34% year-to-date gain), Berkshire’s remaining stake is now valued at around $1.035 billion**. After accounting for initial investments totaling $750 million, this represents a profit of more than $285 million.
Why Buffett Invested: The Core Logic
Despite the crypto connection, Buffett’s decision fits neatly within his value investing framework. Several key factors explain why this investment doesn’t contradict his long-standing skepticism toward digital currencies:
1. Timing Matters: Crypto Came Later
Berkshire invested in mid-2021; Nubank didn’t launch its crypto platform until May 2022. This timeline suggests Buffett’s decision was based on Nubank’s strength as a digital bank in high-growth emerging markets, not its future crypto offerings.
2. Emerging Market Opportunity
Nubank targets Latin America—a region historically underserved by traditional banks. High fees, poor service, and outdated infrastructure created fertile ground for disruption. By offering free accounts, transparent pricing, and seamless mobile experiences, Nubank tapped into massive unmet demand.
3. Founder and Backer Credibility
Founded by David Vélez, a former venture capitalist at Sequoia Capital, Nubank attracted early support from top-tier investors including DST Global, Peter Thiel’s Founders Fund, Tiger Global, and Sequoia itself. Even Tencent invested $180 million at a $4 billion valuation in 2018 and continued to back the company.
4. Revenue Still Rooted in Traditional Finance
Despite its crypto initiatives, Nubank remains fundamentally a traditional financial institution. As of Q3 2024:
- Its interest-earning portfolio (IEP) reached $11.2 billion (up 81% FXN).
- Loan portfolio grew to $5.7 billion.
- Credit card receivables hit $15.2 billion (up 4% FXN).
- Insurance and investment products remain significant contributors.
Crypto-related revenue remains a small fraction of total income—meaning Buffett isn’t betting on volatility but on scalable, regulated financial services.
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Buffett’s Philosophy in Action
Buffett has always emphasized investing in businesses he can understand and predict. His interest in Nubank isn’t about embracing crypto—it’s about recognizing a digitally native bank solving real financial pain points in fast-growing economies.
His approach reflects a broader principle: innovation doesn’t have to mean speculation. While he avoids volatile assets like Bitcoin, he’s open to companies leveraging technology to improve efficiency, expand access, and generate durable cash flows.
As he once said: “Be fearful when others are greedy, and greedy when others are fearful.” In this case, while many investors chased pure-play crypto ventures during the bull run, Buffett quietly backed a fintech with solid fundamentals—and let innovation unfold on the margins.
Frequently Asked Questions (FAQ)
Q: Did Warren Buffett invest directly in cryptocurrency?
A: No. Warren Buffett has never owned Bitcoin or any other cryptocurrency directly. His exposure comes indirectly through Berkshire Hathaway’s investment in Nu Holdings, a digital bank that offers crypto services.
Q: Is Nubank primarily a crypto company?
A: No. While Nubank has launched several crypto features, its primary revenue sources are traditional financial products like credit cards, loans, insurance, and interest-bearing accounts.
Q: Why did Berkshire reduce its stake in Nu Holdings?
A: The sale of nearly 20% of its shares may reflect profit-taking or portfolio rebalancing. It doesn’t necessarily signal loss of confidence—especially since the remaining stake is still highly valuable.
Q: Does this mean Buffett supports crypto now?
A: Not necessarily. His investment reflects confidence in Nubank’s core banking model and Latin American growth potential—not an endorsement of cryptocurrency as an asset class.
Q: How does Nubank make money from crypto?
A: Currently, crypto contributes minimally to revenue. Potential income streams include trading fees, staking rewards passed to users (with margin retained), and increased user engagement leading to higher usage of main financial products.
Q: Can other traditional banks follow Nubank’s hybrid model?
A: Yes. Many banks are exploring stablecoin integration, tokenized deposits, and blockchain-based settlements. Nubank serves as a case study in how legacy financial institutions can adopt new tech without abandoning core principles.
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Final Thoughts: Evolution Without Abandonment
Warren Buffett’s success with Nu Holdings underscores a vital lesson: adaptation doesn’t require abandoning principles. He didn’t change his mind about crypto—he found a way to benefit from technological progress without compromising his value-driven approach.
In an era where digital transformation reshapes finance, Buffett proves that even the most conservative investors can participate in innovation—if they do so selectively, patiently, and with discipline.
For savvy observers, the takeaway is clear: look beyond headlines. Sometimes, the biggest shifts happen not with fanfare—but with quiet investments in companies building the future on solid ground.