Fortress Loses $3.7M On Bitcoin

Mar 3 2014 | 11:58am ET

The turmoil surrounding digital currency bitcoin has proven costly for Fortress Investment Group.

The alternative investments giant said last week that it had lost $3.7 million on its bitcoin investments. In the Securities and Exchange Commission filing, Fortress did not elaborate on its bitcoin bet, other than to say it bought $20 million worth of the controversial crypto-currency last year, and that the bitcoins were worth only $17 million at the end of 2013.

The investment, if Fortress continues to hold it, is likely to have fallen further since. Bitcoin prices have been dropping. Late last month, Mt. Gox, one of the largest bitcoin exchanges in the world, closed and filed for bankruptcy, reportedly after hackers made off with half a billion dollars worth of bitcoins.

Fortress had reportedly planned to start a bitcoin fund, and the firm's macro co-chief investment officer, Michael Novogratz, also invested in the currency last year.

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