In the third quarter, hedge fund billionaires Philippe Laffont and Steven Schonfeld sold Amazon stock and added to their positions in the iShares Bitcoin Trust.
Philippe Laffont of Coatue Management sold 1.4 million shares of Amazon, trimming the position by 14%. He purchased 76,100 shares of the iShares Bitcoin Trust, more than doubling his stake.
Steven Schonfeld of Schonfeld Strategic Advisors sold 253,700 shares of Amazon, reducing the position by 72%. He added 1.1 million shares of the iShares Bitcoin Trust, increasing his stake by 20%.
Laffont and Schonfeld outperformed the S&P 500 by 94 percentage points and 22 percentage points, respectively, over the last three years.
Wall Street expects Amazon's earnings to grow at 19% annually over the next three years. The current valuation of 34 times earnings looks fair, analysts say.
Tom Lee at Fundstrat Global Advisors says Bitcoin's price could hit $3 trillion in the long run, implying more than 3,000% upside from its current $95,000. Michael Saylor of Strategy says its price could hit $13 million by 2045, implying more than 13,500% upside.
More companies and institutional investors are buying Bitcoin or spot Bitcoin ETFs. Demand is likely to continue because Bitcoin is the more popular and most liquid cryptocurrency.
Over the past year, the number of BTC held by government agencies increased 25%, and the number held by public and private companies increased 55%. The number of large asset managers with positions in the iShares Bitcoin Trust more than doubled, and their reported shares more than quadrupled.
Bitcoin has fallen 25% from its record high. Profit taking and the unwinding of positions built on borrowed money contributed to the drawdown.
Bitcoin currently trades at 20 times its thermocap, well below the historical average of 50, according to Morgan Stanley.