“As an investment, it is extremely volatile and appears to be easily manipulated,” he said. “Thus it is not a prudent investment, it is not strategic for us as an investor and in our view, it is not sustainable.”
Jamie Hannah, the deputy head of investments at global investment manager VanEck said the fund was seeing increasing interest in Bitcoin, especially from financial planners asking on behalf of their clients.
VanEck recently listed a Bitcoin exchange-traded note in Germany that allows investors to buy units in the fund, which represent the price of Bitcoin, without having to delve into investing in the asset themselves.
Despite this, Mr Hannah agrees that Bitcoin is a problematic asset, saying while it was gaining popularity as an alternative to gold, its status as an actual store of value was debatable.
“In terms of a reputable, well-managed asset class with an exchange and regulation, Bitcoin is the exact opposite,” he said.
“And whether or not it has any real value to it or if it becomes a store of real currency in the long run, is debatable.”
Other fund managers were also dismissive of the currency. Russel Pillemer, Pengana Capital chief executive, said there was no “intrinsic value” to the asset and it was of little interest to him or his fund.
“It’s an entirely speculative asset, it’s not something we would look at or even consider,” he said.
Another compared it to gambling, saying “I generally go to the casino when I want to have a decent punt”.
But the pessimism amongst institutional investors does not appear to be reflected in the attitudes of everyday Australians, with a recent study by one of the country’s largest cryptocurrency exchanges, Independent Reserve, showing 18.4 per cent of Australians own some type of cryptocurrency.
Awareness has also hit an all-time high, with 91.4 per cent of Australians saying they have heard of at least one crypto. Over three-quarters of those who owned cryptocurrency during 2020 said they were currently either breaking even or better on their investments.
“We’re seeing more and more investors look to Bitcoin as a growth strategy,” said Independent Reserve chief Adrian Przelozny.
“It marries with the attitudinal shift we’ve seen across the Australian population as now almost two in five people view bitcoin as a store of value or an investment vehicle.”
A concise wrap of the day on the markets, breaking business news and expert opinion delivered to your inbox each afternoon. Sign up here.
Dominic Powell writes about the retail industry for the Sydney Morning Herald and The Age.
Most Viewed in Business
Read more:Fund managers steer clear of Bitcoin despite surging prices