The liquidity of large institutional investors in bitcoin is increasing, 71% com

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The liquidity of large institutional investors in bitcoin is increasing, 71% comes from hedge funds

Bloomberg reported it, with an article published yesterday that takes up the data released by grayscale, the liquidity that the large institutional investors bring in bitcoin has skyrocketed, recording an increase of 66% compared to 2018; 71% of institutional investments, as can be read in the article, come from hedge funds.

Hedge funds have the main objective of producing constant returns over time by means of investments which, taken individually, present a high financial risk, but which offer the possibility of very fruitful returns; they are normally used to reduce the risks and volatility of portfolios, with the aim of managing assets, largely eliminating market risk.

However, not only hedge funds invest in bitcoins but also common investors (with important portfolios), banks and pension funds.

Interviewed by Bloomberg Michael Sonnenshein, CEO of Grayscale, said that:

"It is clear that bitcoin is seeing an institutional adoption, after all it is the whole business class that is experiencing an increasing validation by legacy companies such as Fidelity and CME, signaling to the institutions and the investment community as a whole that cryptocurrencies are here to stay "

It is also important to highlight how the number of entities that are investing in bitcoin has also increased in the face of the increase in liquidity of large institutional investors; Grayscale, for example, said that its customer portfolio has grown 29% over last year.

This means, on the one hand, that trust in crypto assets is growing, on the other that those who had already invested in bitcoins and cryptocurrencies in previous years are raising the stakes; however, from a community point of view, institutional adoption is, within certain terms, not as relevant as adoption by ordinary people is considered.

In other words, if bitcoin were to survive as a mere investment tool for the financial world, this would mean that the community has failed in its main objective, that of giving life to a currency of common use and of global reach, which was expendable everywhere and by anyone, free from the traditional banking system.

For this to happen, therefore, it is necessary that bitcoin establishes itself on the market as a means of payment and not as a financial instrument; obviously the developers are working precisely in this direction, hence the enormous efforts to try to solve the problem of scalability and simplify the use of this technology for the benefit of all those who are completely lacking in even the slightest IT skills.


Source: Publish0x