Marks is co-chairman of the investment firm Oaktree Capital. According to CNBC, his past investment memos predicted the financial crisis and the dotcom bubble implosion. Now, he's warning his clients to steer clear of the digital currency.
"In my view, digital currencies are nothing but an unfounded fad (or perhaps even a pyramid scheme), based on a willingness to ascribe value to something that has little or none beyond what people will pay for it," Marks wrote in an investor letter, according to CNBC.
Bitcoin's value against the dollar has nearly tripled this year as public interest in digital currencies has spread. It remains highly volatile though, losing some 30% in just over a month between June and July due to a dispute over how to help its underlying technology adapt to the sharp increase in demand for it. It also continues to be dogged by associations with illegal activities. A t Thursday's levels just under $2,600, it's about 12% below its all-time high against the dollar. But its stellar gains – it's up over 900% in the last two years against the dollar – mean that early backers have been able to sell their investments at huge profits to later investors who, in many cases, have little understanding of what they're investing in.
"Serious investing consists of buying things because the price is attractive relative to intrinsic value," he continued. "Speculation, on the other hand, occurs when people buy something without any consideration of its underlying value or the appropriateness of its price."
Oaktree Capital has $99 billion of assets under management as of June 2017, according to CNBC.