Winklevoss Twins Pouring Millions Into Bitcoin, Just as It’s Crashing

The Winklevoss twins are back! (You may know them as Tyler and Cameron. Or just the Winklevii.) And this time they’re not just peddling some silly plan to create a virtual “Face Book”–they’re investing in play money! Bitcoin, the investment flavor of the last month, is a virtual currency that’s supposed to be more reliable than fiat money. Here’s what’s happened to the virtual currency since January, when it was trading at about $10.

Prices quickly doubled, then tripled, and finally quadrupled in early 2013 as more and more companies began accepting Bitcoin payments….[then] the botched Cypriot bank bail-in scared so many people into thinking their deposits weren’t safe that they moved into Bitcoins instead. Prices quadrupled again — from $65 to $266 — in just three weeks.

So earlier this week, guess who turned out to be riding high on Bitcoin?

The Winklevii, as they are known, have amassed since last summer what appears to be one of the single largest portfolios of the digital money, whose wild gyrations have Silicon Valley and Wall Street talking. The twins, the first prominent figures in the largely anonymous bitcoin world to publicly disclose a big stake, say they own nearly $11 million worth.

At least that’s before Bitcoin crashed, plummeting to about $120, until trading resumed late last night. Despite the volatile nature of the currency, the Winklevii are defiant that they made the right move.

“People say it’s a Ponzi scheme, it’s a bubble,” said Cameron Winklevoss. “People really don’t want to take it seriously. At some point that narrative will shift to ‘virtual currencies are here to stay.’ We’re in the early days.”

Tyler was a little more diplomatic.

“It has been four years and it has yet to be discredited as a viable alternative to fiat currency,” Tyler Winklevoss said. “We could be totally wrong, but we are curious to see this play out a lot more.”

Nor has it really been credited as a viable alternative to fiat currency. But good luck! [NY Times]