Record Interest from Institutional Investors in Bitcoin
In March, a senior Goldman Sachs executive noted that retail investors were driving the inflows into spot ETFs. This led to skepticism about predictions of Bitcoin reaching $100k this year, as retail investors tend to lack long-term planning and often pull back at the first sign of market weakness.
The pattern of these inflows supported this view and hinted at a coming correction: the inflows slowed in April and then turned into outflows.
However, recent 13F reports reveal that institutional investors (with assets over $100m) are showing record interest in Bitcoin-ETFs. In the first quarter, 414 institutional investors invested in BlackRock’s IBIT alone. Bloomberg’s Eric Balchunas noted that having 20 such holders is typically a good sign for a fund’s first quarter.
To gauge the scale, consider the interest this group has shown in all ETFs launched in 2024.
Institutional investors put $3.5bn into Bitcoin-ETFs, making up 29% of the total capital inflow. The largest of these was Millennium Management, which bought $1.9bn worth of crypto fund shares.
Last week, when this data was made public, spot investments surged again, with net inflows totaling $948 million.
Bitcoin responded positively to the news, rising to $67k.
This interest from institutional investors indicates a strong professional assessment of Bitcoin’s growth potential. Even JPMorgan, despite its CEO’s known scepticism towards crypto, has invested in Bitcoin.
This trend is expected to continue as more players learn about the new product and evaluate the risks. Even Japan’s largest pension fund, with $1.5 trillion in assets, is considering crypto as a hedging tool.
Cryptocurrencies involve complexity and carry a high risk of rapid monetary loss due to volatility and changing regulatory landscape. It’s crucial to ensure you understand how cryptocurrencies operate and can withstand the potential high-risk scenario of losing your assets.
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