Rally in bitcoin price is closely correlated to growing adoption by institutional investors and corporations
Nickel Digital Asset Management (Nickel) says the rally in the price of bitcoin is closely correlated to the growing adoption of the cryptocurrency by institutional investors and corporations, and it expects this trend to gather pace.
A new survey of institutional investors and wealth managers from the investment manager reveals that just over eight of out ten who already have exposure to bitcoin expect to increase their allocation in the short-term, and 29 per cent expect to see a dramatic increase in corporations using bitcoin for their treasury reserves.
Anatoly Crachilov, co-Founder and CEO of Nickel Digital, says: “The list of institutional investors and corporations allocating in bitcoin is growing rapidly and includes names such as Tesla, the business intelligence firm MicroStrategy, and high-profile asset managers Paul Tudor Jones, Bill Miller, Ruffer, and Guggenheim Partners. All of this is a huge endorsement for the cryptoasset space, and this space is now on the radars of both institutional allocators and corporate treasurers alike. Based on our own ongoing conversations with institutional investors, we expect even more forward-looking allocators to take a positive stance on this asset. Recent price action, with Bitcoin crossing USD50,000, is just another interim data point in a structural multiyear expansion of this asset class, driven by unfolding institutional adoption.”
“The growing interest in cryptoassets cannot only be explained by the recent appreciation in the value ofbBitcoin, but indeed by its role as a hedge against currency debasement, a risk triggered by a record 28 per cent expansion of US M2 money supply during the Covid-19 crisis. In contrast to traditional fiat systems, bitcoin is a non-discretionary asset, without anyone’s ability to inflate its supply over time. Given the transparent and immutable monetary policy of the Bitcoin protocol, its powerful store-of-value function, and increasing acceptance by institutional investors, this market is positioned for a structural expansion cycle.”