Even in a Bear Market Institutional Interest in Crypto Is Very Bullish
The Institutional Interest In The Crypto Bear Market Is Very Bullish
Capitalism has one rule above all: buy low, sell high. Because of this, there is some logic in why so many institutional investors are interested in the market today while they were not that much last year when the Bitcoin bull run happened.
As the crypto industry retains a strong bearish sentiment during the year and the prices have dipped down significantly, many institutional investors are slowly entering the market. Why? Because they have seen all the potential of the crypto market and they have perceived that this is the best time to buy the assets if you want to hold them for a long time.
As the chance to buy Bitcoin for less than $100 USD is long gone, now seems like the best time. The price of the cryptos has found some stability in the $6,000 price range and and the prices are very stable to invest. While bad for speculators and for people who use arbitrage techniques for profit, this is a great time for institutional investors.
Some recent studies have affirmed that the number of crypto hedge funds is higher this year than it was ever before. This can be considered the ultimate proof that the market has seen the potential of cryptos and decided to explot it.
You should look no further than Michael Novogratz, a well-known investor, to perceive the move. He has converted about 30% of his fortune to cryptocurrencies and has created a crypto fund. Other names include Garry Tan, Dan Morehead (Pantera Capital) and even high-profile universities like Yale, Stanford, Harvard and MIT.
The Bitcoin ETF
Why is everybody so interested in cryptos? It’s fair to say that there is more than a blind faith that the market will thrive. In fact, these days only the most hardcore evangelists seem to believe that the price will rise like it was in 2017 so soon. The main reason why the institutional investors have their eye on this market is mostly because of the Bitcoin ETF.
The ETF has been in the center of the crypto discussion since the beginning of 2018. The United States Security and Exchange Commission (SEC) has been rejecting most ETF ideas, but the market has faith that eventually an ETF will be approved (mostly because people will try until it is) and that this will make the prices rise.
While there is always the possibility of another crash, the stability of the bear market has gave courage to many investors so they can bet in cryptos and hope for the ETF in the future. as the market is getting increasingly regulated, Bitcoin is getting less volatile and safer, so it should be the kind of asset that will still get a lot of people’s attention, the institutional investors are just being faster than the others.