Institutional investors optimistic about future rise in bitcoin value, says new research
Year to date, the value of bitcoin has increased by around 64 per cent and one bitcoin is now worth around USD11,500, while new research reveals institutional investors expect further rises in the valuation of the cryptocurrency this year.
Evertas, the world’s first cryptoasset insurance company, which focuses on covering institutional holders of cryptoassets including exchanges, custodians, traditional financial institutions, funds, family offices and ultra-high net worth individuals, surveyed institutional investors who collectively manage USD78.4 billion of assets. It found 60 per cent think bitcoin will be worth over USD12,000 by the end of this year, and four out of ten (40 per cent) expect one bitcoin to be valued at over USD15,000 by 2021. Only 24 per cent think it will be worth USD10,000 or less.
In December 2017, bitcoin nearly hit USD20,000, and 22 per cent of institutional investors think it could reach this figure next year, with 28 per cent anticipating this will happen in 2022.
One key reason for the recent rise in the value of bitcoin is its recent ‘halving’ (which happened in May), as the two previous times this happened led to rises in the valuation of the cryptocurrency. This helps explain why one in four institutional investors (24 per cent) think the recent halving will lead to a dramatic increase in the amount invested in bitcoin, and 68 per cent think it will lead to a slight increase.
J Gdanski, CEO and Founder of Evertas, says: “Institutional investors are clearly optimistic about the future valuation of bitcoin, and no doubt their views here have been fuelled by strong growth in the cryptocurrency during July and August. However, a rising valuation is not enough to entice some institutional investors into the cryptocurrency market, as many have concerns regarding the infrastructure of this sector. For example, 88 per cent are worried about the lack of adequate insurance cover for these assets, and 92 per cent are concerned about the quality of the custodial services available.
“The cryptoasset market must address these issues if they are really going to capitalise in full on the growing interest institutional investors are showing in these assets.”
Earlier this year, Evertas completed a Seed Stage funding round and raised USD2.8 million. The funding round was led by Morgan Creek, who were joined by Plug n Play, Kailash Ventures, RenGen, Vy Capital and Wavemaker Genesis. Mark Yusko, Founder, CEO and Chief Investment Officer of Morgan Creek Capital Management & Managing Partner of Morgan Creek Digital Assets, joined Evertas’ Board of Directors.
It also received its licence from the Bermuda Monetary Authority to start operating from the jurisdiction. It operates as a ‘Class 3A’ insurer.