New financial technologies such as bitcoin may become increasingly attractive to investors as a protection against central bank low- and negative-interest-rate policies that threaten capitalism, according to billionaire bond manager Bill Gross.

Policies by the Federal Reserve, Bank of Japan and European Central Bank are destroying historical business models that foster savings, investment and economic growth, Gross, who runs the $1.5 billion Janus Global Unconstrained Bond Fund, said in an October investment outlook released Tuesday. He said that as investors lose faith in the system, they will increasingly seek havens.

“Bitcoin and privately agreed upon blockchain technologies amongst a small set of global banks are just a few examples of attempts to stabilize the value of their current assets in future purchasing power terms,” he wrote. “Gold would be another example — historic relic that it is. In any case, the current system is beginning to be challenged.”

Blockchain is the technology underlying bitcoin, a digital currency that uses encryption techniques to generate new money and verify fund transfers, independent of a central bank. Two members of the U.S. Congress formed a caucus last month to advocate for cryptocurrencies and blockchain-based technologies, which may require new laws to thrive.

Central banks are acting increasingly like casino gamblers who double down on bets every time they lose, according to Gross, a strategy that works as long as they can print unlimited amounts of money. The approach, which aims to encourage borrowing and economic expansion, has failed to create sustainable growth while driving investors into increasingly risky assets as they seek higher yields, he said.

“Central bankers have fostered a casino-like atmosphere where savers/investors are presented with a Hobson’s choice, or perhaps a more damaging ‘Sophie’s Choice’ of participating (or not) in markets previously beyond prior imagination,” Gross wrote, hammering a favorite theme. “Investors/savers are now scrappin’ like mongrel dogs for tidbits of return at the zero bound. This cannot end well.”

In a tweet posted Tuesday, Gross warned: “ECB Taper Tantrum underway. Bearish for Global bonds.”

European Central Bank officials have reached an informal consensus to wind down bond purchases, which have been running at 80 billion euros ($90 billion) a month, a signal that they are reducing efforts to stimulate the economy through ultra-loose monetary policy, Bloomberg reported.


Scaling Back

A so-called taper tantrum rocked the U.S. bond market in 2013 when then-Federal Reserve Chairman Ben Bernanke signaled a reduction in monthly purchases of Treasuries and mortgage-backed securities.

Gross’s unconstrained fund returned 5 percent this year through Monday, outperforming 66 percent of its Bloomberg peers. The fund has returned 4 percent since he took over in October 2014 after an acrimonious exit from Pacific Investment Management Co.

Janus Capital Group Inc. announced Monday that it was merging with London-based Henderson Group Plc to form a $320 billion asset manager.