Mexican billionaire with 70% of his investment portfolio in bitcoin says it's better than real estate

Mexican billionaire Ricardo Salinas Pliego, whose net worth is estimated at roughly $5 billion, is a bitcoin maximalist.

He is so convinced that bitcoin is the best long-term investment that he holds 70% of his investment portfolio in the digital asset, believing that traditional fiat currencies are destined to lose purchasing power over time. The allocation is unusually large by conventional portfolio-management standards, where wealth advisers typically recommend limiting exposure to highly volatile assets.

Salinas — whose company, Grupo Elektra, is one of Mexico’s largest business groups, expanding across retail, banking, telecommunications and media — has such a strong conviction on bitcoin that he once advised his wife to mortgage her home and buy more of it. And she did.

“I know this is a controversial topic, but I convinced my wife to mortgage the house that she has and take a loan to buy bitcoin,” Salinas told CoinDesk.

He says everyone should at least consider converting some of their home equity to bitcoin.

“For most people, the biggest investment, their nest egg, is their home equity. Find a way to transform that into some kind of bitcoin exposure to a larger or to a smaller degree,” he said. “So then you can bet on the asset of the house appreciating, the house asset appreciating, and the bitcoin asset appreciating.”

Salinas points to bitcoin’s long-term appreciation relative to real estate as evidence for his view. In January 2016, the price of bitcoin hovered around $400. A house in Central London sold for an average price of $1.6 million or 4,000 bitcoin. With home prices remaining basically unchanged ten years later, that same purchase would require less than 30 bitcoin.

For Salinas, that comparison illustrates why he believes bitcoin outperforms traditional stores of value such as real estate over the long term.

“It’s an asymmetrical bet to the upside,” he said. “The more people find out about bitcoin, the more demand there will be.”

The ‘fiat fraud’

Salinas, who has emerged as a potential presidential candidate in Mexico for the 2030 election, traces his deep belief in fiat devaluation to a time long before digital currency even existed. Back when then-President Richard Nixon severed the U.S. dollar’s direct convertibility into gold, ending the gold standard.