Investor Bill Miller said he has split most of his fund's bitcoin holdings into a separate fund.

The founder of Miller Value Partners said Tuesday on CNBC's "Closing Bell" that the fund had moved 90 percent of its bitcoin holdings to a separate fund, with the main fund retaining a 10 percent weighting in bitcoin and its offshoot, bitcoin cash.

This is after the cryptocurrency's meteoric rise in value last year. CNBC reported in December that Miller said half the value of his fund was in bitcoin.

He said they began buying bitcoin in 2014 or 2015, at an average cost of about $350. Bitcoin is currently trading near $14,935, according to CryptocurrencyMarket.com. Moving it to a separate fund allows investors to decide whether they want to continue to hold or sell it, he told CNBC.

Digital currencies have grabbed a lot of attention from investors because of their quick and steep gains in the last few months. A coin created by the start-up Ripple dropped 10 percent earlier Tuesday after soaring 35,000 percent last year. Miller told CNBC on Tuesday that the rally in ripple, which is currently trading around $2.18, was "way overdone."

But the interest in new digital coins hasn't gone away. Also on Tuesday, Kodak, a 130-year-old company, announced it will roll out its own digital currency as part of a new photography royalty tracking product.

"There's probably something out there that makes sense but it takes a lot of digging to find it," Miller said about the wave of newer, much cheaper alternatives to bitcoin. "It's not exactly, I'd say, careful evaluation going on."

Miller founded his fund in 2016 after 35 years as a manager at Legg Mason, where he rose to celebrity by beating the S&P 500 15 years in a row through 2005. He earned a reputation for taking concentrated bets. His fund currently holds bank stocks such as Citigroup, Bank of America and J.P. Morgan.