Buffett’s $17B T-bill buy: Is a Bitcoin crash coming?

• Warren Buffett's Berkshire Hathaway has increased its liquidity by purchasing $17 billion in US Treasury bills, bringing its total cash reserves to $373 billion.
• The firm's massive cash pile at the end of 2025 is more than double the amount held at the end of 2023, signaling a cautious outlook on the current market.
• History suggests that Buffett’s shift to cash often precedes major stock market corrections, which could lead to a significant price drop for Bitcoin.

Berkshire Hathaway’s Record Cash Accumulation

During a recent appearance on CNBC, Warren Buffett confirmed that Berkshire Hathaway participated in a recent auction to buy approximately $17 billion in US Treasury bills. This move has pushed the firm’s total cash and equivalents to a record $373 billion by the close of 2025. This is a substantial increase from the $334.2 billion recorded a year prior and represents a more than twofold increase compared to the end of 2023.

Buffett remains unimpressed by the recent 5.75% decline in the S&P 500 from its January peak. He characterized the current pullback as minor compared to historical crashes where markets plummeted by more than 50%. By building this massive reserve, the legendary investor suggests that equities are not yet cheap enough to justify significant buying.

Historical Patterns and Divestment from Fintech

The strategy of moving into cash is a familiar one for Buffett. Historical data indicates that he typically liquidates positions before major downturns. For example:

• In 1998, he raised cash levels to $13.1 billion, or roughly 23% of total assets.
• By mid-2000, cash reserves reached $15 billion (approx. 25% of assets) just before the Dot-com bubble burst.
• In the first quarter of 2025, Berkshire completely exited its position in the crypto-friendly fintech firm Nu Holdings, securing a profit of $250 million.

Impact on Bitcoin and Market Forecasts

While Buffett has long been a critic of Bitcoin, calling it "rat poison," his market timing often impacts the broader financial landscape. Since 2020, Bitcoin has shown a strong positive correlation with traditional equities, specifically the Nasdaq. Currently, the 20-week rolling correlation coefficient between the two stands at 0.47.

If the stock market faces a crash similar to the 50% drops Buffett alluded to, Bitcoin is expected to follow suit. Analysts are currently weighing several risk factors:

• A 50% probability of a US recession.
• Inflationary risks driven by geopolitical conflict.
• New concerns regarding quantum-security.

Under these pressures, some market experts forecast that Bitcoin could see its price fall to as low as $30,000 in 2026.