The world of cryptocurrencies is booming. This is shown, among other things, by the bull market at the turn of 2020/2021. Its special feature is something that senior market participants have been waiting for a long time. We are talking about the presence of institutions that in cryptocurrencies have decided to secure huge capital. In this article, we will take a look at the most well-known investment companies in Bitcoin and how they operate and influence global adoption.
Grayscale investment fund is a real catalyst for BTC price increases. The firm aims to support large investors, often including institutional investors, by purchasing cryptocurrency assets and holding them. At the peak of the first quarter of 2021, Grayscale’s portfolios held over 655,000 BTC. In addition to investing in the king of cryptocurrencies itself, Grayscale also backs Ethereum, Litecoin, Stellar, and many other projects, and is constantly considering ways to expand its portfolio of investment assets.
Another giant with similar characteristics is the company managed by Michael Saylor. Microstrategy’s operations are similar to Grayscale’s policies and are also based on investment intermediation. Moreover, Saylor himself has become one of the icons of the cryptocurrency world. Among other things, he has conducted numerous webinars in which he explained to potential investors what a potential investment in Bitcoin is and what it entails. On May 19, 2021, the owner of Microstrategy announced that the entities he controls hold 111,000 BTC.
The company run by Elon Musk has adopted a nicely different investment model in BTC, but one that is just as significant in terms of adoption. We described the car tycoon owner’s character in an article titled “Elon Musk and his impact on the cryptocurrency market”. If you haven’t read it yet, we encourage you to read it. At the beginning of 2021, Tesla communicated securing its financial reserves with Bitcoin. BTC equivalent to $1.5 billion was purchased. Later on, it was also possible to purchase Tesla cars using just BTC. The idea was scrapped shortly after, but Tesla’s assets are still backed by the king of cryptocurrencies.
CoinShares, on the other hand, is a company that has launched a slightly different way of trading crypto assets albeit equally interesting. The company listed on the Swiss exchange SIX offers the opportunity to invest in CoinShares Physical Bitcoin (BITC). This is an ETP product that is settled in a similar way to stock market shares, but backed by physical Bitcoin. CoinShares has been followed by other European institutions. Their number continues to grow.
Back in December 2020, the U.S.-based life insurance company communicated its investment strategy, which includes Bitcoin. MassMutal estimated the value of its purchases at $100 million. Bitcoin thus became less than 0.5% of the value of the company’s financial security. Representatives of MassMutal declare that the purchase of BTC is a way to diversify their portfolio and participate in the crypto market, which is growing in importance.
The impact of institutions on Bitcoin’s price and global adoption.
There is no doubt that institutions have contributed significantly to the rapid price movements in the cryptocurrency market. Each successive news of a big company digging out a piece of the great crypto pie has received a lot of attention. Psychologically, these are also voices of authority that caused more and more retailers to start seeing cryptocurrencies as an opportunity to secure or even increase their capital. Furthermore, it is important to remember that these are just some of the companies investing in BTC. There are probably many more undisclosed entities. What will happen when they announce their participation in the market? Perhaps we will find out soon.