Why Two Sigma’s David Siegel Is Worried About Bitcoin

The cofounder of hedge fund giant Two Sigma is no fan of cryptocurrencies—though he does see promise in its underlying technology, blockchain.

“I guess I’m a little skeptical that [cryptocurrencies] are going to hold value the way that people expect that they will,” David Siegel, co-chairman of Two Sigma, a hedge fund with $52 billion under management, said at the Bloomberg Invest conference Tuesday.

However, he was careful to clarify that the technology behind digital currencies, an information database called blockchain that is said to be secure and immutable, has promise. “I think the blockchain is a really fantastic technology…the blockchain is really going to have genuine applications.”

When asked if he preferred any specific cryptocurrency, he answered, “They’re all about equal in my mind.” Then he dropped his palm toward the floor, signaling the level of prestige the asset held in…