O'Leary: digital assets will become the S&P's 12th sector

O'Leary walks back his Ethereum call and reframes crypto as a 12th S&P sector

Kevin O'Leary says his investment framework treats crypto, or "digitization," as effectively a 12th sector of the S&P, since it services all 11 others. He applies his usual portfolio rules — no more than 5% in any single stock, no more than 20% in any one sector — but notes he has run positions as high as 23% in crypto over the last seven years.

He revisits a call he made about 18 months ago, when he and other investors assumed everything would standardize on Ethereum because BTC and ETH captured "97% of the entire volatility." He says that hasn't happened, and now believes sectors will pick their own chains rather than converge on one.

"We're wrong about ETH being standard... maybe it's too slow, maybe whatever, people aren't happy."

He adds he no longer thinks Ethereum is fast or secure enough to win the exchange business, calling this his own opinion.

Asked what would make him increase his crypto allocation, O'Leary points to adoption: specifically, an exchange formally adopting a given chain.

"If you told me an exchange adopted one of these chains, I'd be all over that."

The host notes that privacy tokens, citing Zcash, have been strong performers, though O'Leary does not comment directly on that claim.

O'Leary's shift into alternatives, power, and uranium

O'Leary says he has moved away from a traditional 60/40 portfolio; alternatives now make up 23% of his holdings. On AI, he says he avoids picking which model wins and instead invests in the "picks and shovels" — power. He cites Bit Zero, a former Bitcoin miner now trading on NASDAQ that he says has shifted to power contracts in Norway and Finland, plus private power projects he holds in Alberta and Utah.

He also discloses his first-ever long position in the physical uranium commodity, tied to his expectation that small modular reactors will expand across the US grid.

On tokenization's ultimate winner, O'Leary repeats that it will be "the chain that gets the first exchange," adding that clarity legislation likely won't pass until after the midterms, though he expects it to pass on a bipartisan basis eventually. He does not name a timeline or figure for Bitcoin reaching a million dollars, leaving that question open.