Billionaire Paul Tudor Jones Eyes Bitcoin Amid Inflation and US Debt Fears
2024-10-23

Paul Tudor, a billionaire investor and “trading wizard,” says he is considering adding Bitcoin BTCUSD to his portfolio. This pivot comes amid concerns about the US government’s debt and deficit problems.
The statement comes as the countdown to the US election continues, with either Donald Trump or Kamala Harris set to become the 47th President of the United States.
Paul Tudor Jones Warns of US Inflation, Eyes Bitcoin as Hedge
The veteran Wall Street investor says the US government’s debt and deficit problems will not go away regardless of who wins the November elections. In his opinion, “all roads lead to inflation,” even after the elections.
These remarks came during a Tuesday interview with CNBC. Tudor said his portfolio could include Bitcoin, commodities, and tech stocks. However, he “rejected” bonds.
In a recent announcement, the Federal Reserve Bank of New York indicated that the average inflation expectation of US consumers in the next 12 months is about 3%. This contravenes the Federal Reserve’s (Fed) preferred inflation target of 2% per year.
According to Tudor, rising US government spending and upcoming tax cuts make the Fed’s inflation target out of reach. Based on this, he cautions that the US is on a path to a deficit unless it works on its spending. He indicated that the national debt has increased to 100% of Gross Domestic Product (GDP), signifying a 60% increase in 25 years.
Against this backdrop, the billionaire investor says the next US president will have to face this problem. Nevertheless, the promises both Donald Trump and Kamala Harris are already making ahead of the elections are bound to worsen the situation. Notably, the commitments revolve around spending increases and tax cuts.
Jones’ remarks align with the US Congressional Budget Office (CBO) estimate that the federal deficit in fiscal year 2024 would hit $1.9 trillion. According to the billionaire investor, this is avoidable through inflation and economic growth. He, therefore, recommends an expansionary policy by the government to keep nominal interest rates below inflation.
Noteworthy, Paul Tudor started shilling Bitcoin four years ago and held around 2% of his assets in BTC in 2020. His longstanding impression of the pioneer crypto is that it is a good portfolio diversifier.
Massive Capital Inflows into Bitcoin ETFs Before US Elections
According to JPMorgan analysts, demand for Bitcoin and, therefore, its momentum could increase. This is in the context of economic instability worsened by geopolitical tension. Bitcoin presents as a hedge, and the same is already happening with gold.
Similarly, massive capital inflows into Bitcoin ETFs (exchange-traded funds) in September and October follow outflows in August. This suggests retail and institutional investors already perceive Bitcoin as a hedge.
As BeInCrypto reported, citing CoinShares researchers, the US elections now pass as the leading tailwinds shifting focus away from the economy. The election narrative continues to drive crypto inflows. With the US elections approaching on November 5, the narrative around crypto as a political topic could gain further momentum.
This growing interest is expected to significantly benefit digital asset investment products as crypto becomes a focal point in an increasingly expansive voter landscape. The political spotlight on crypto, coupled with market factors, positions digital assets for potential growth. It comes amidst heightened investor engagement leading into November.
According to Polymarket data, Donald Trump continues to widen the lead range against Kamala Harris. He boasts a 63.7% winning odds lead against Kamala Harris’ 36.2%.