Sell: the best of crypto hater Burry

Famous for: Cassandra of the cryptocurrency market. Founder of hedge fund Scion Capital, LLC.

Address: San Jose, California, USA.

Date of birth: June 19, 1971 (age 51).

Hobby: Personal investments.

Distinguishing Features: Shorts specialist.

Burry named his fund Scion Capital after Terry Brooks' science fiction novel The Scions of Shannara. The “Scions” takes place on Earth, which is ruled by a brutal military order called the Federation. The elves disappeared, the dwarves were imprisoned, and magic was forbidden. As they say, coincidences are accidental. But back in 2008, Burry performed a financial magic trick (without subsequent exposure).

Back in 2005, Michael bet $1 billion in client’s funds, convinced that the subprime mortgage bonds would lose their value. Three years later, at the peak of the mortgage crisis, Scion Capital investors earned $700 million, and Burry himself around $100 million. This story shook the foundations of society. Two books have been written based on it. To convey the important lessons of the financial crisis to a wide audience, they even shot the film called “The Big Short''. The role of handsome villain Michael Burry was played by Christian Bale. At the end of the film, the protagonist suddenly realizes that he has made a bet against the economy, against the foundations of a civilization, and, ultimately, against himself. We don't exactly know if real Burry realized the same thing. But the facts are: Scion Capital's net income for the period from November 2000 to June 2008 was 489.34%. Ever since, Michael has been passionate about personal investments and the enigmatic tweets from the Cassandra account.

In the fall of 2021, Burry received a letter from the SEC asking him to take part in the GameStop investigation. Thanks to the coordinated efforts of WallStreetBeets members, GameStop shares price skyrocketed from $10 to a record $400. 

One would say, what does Burry have to do with it? He managed to make some money in this situation as well. Initially, his GameStop valuation was very optimistic and helped attract some retail investors. When GameStop shares peaked, Michael cashed out and made a huge profit. Burry refused to cooperate with the SEC in the GameStop case

It is possible that the SEC wanted to cooperate with Michael for another reason. Throughout 2021, Burry has been consistently critical of cryptocurrencies.

He called Shiba Inu “pointless”, ridiculed the rising price of Dogecoin, and asked for advice on how to short crypto. He warned that Bitcoin is a “speculative bubble” backed by huge leverage and defenseless against regulators. 

Not that he was categorically wrong, but we must still not forget that Burry is used to monetizing his skepticism. At that moment he was actively shorting Cathie Woods' exchange-traded fund ARK Invest Disruption Innovation. Shareholders of ARK Invest are the largest crypto investors. Thus, he made a big short again. According to the SEC, by the end of 2021, Michael closed his short against the Katy Woods fund. But, as Bloomberg suggests, Burry could keep them open by buying put options on the OTC market (such contracts are not reflected in SEC reports).

At the end of January 2023, “Cassandra” shocked the suffering crypto community again. Hours before the Fed's interest rate decision, Burry tweeted: “Sell!” Many took his tweet as a negative prediction for bitcoin, cryptocurrencies, and the financial markets in general. However, after Michael’s bearish tweet, the markets rose. Burry deleted his account, and the crypto community made fun of dupe Michael. Probably, they will be right at the end. But Burry has deleted his tweets and his account several times now. And then he returned with new predictions and bags of money. Something tells us, that legendary investor once again will “sell you all, buy back, and sell again, but this time for more money!” ©