The recent interview of Grayscale executive clears all the doubts that why Bitcoin investments are increasing. The major reason behind Institutional investors’ interest in Bitcoin is because of the current situation due to COVID-19.
$3.8 Billion as of June
Ray Sharif-Askary, the director of investor relations at Grayscale, accepts that Grayscale has received $1.7 billion from financial institutions and hedge funds for Bitcoin and mainstream cryptocurrencies. During his interview, the host of Coinscrum markets podcast, Nisa Amolis, says that the financial giant now has $3.8 billion in assets under custody which is more than $2.1 billion witnessed in May 2019. Similarly, the average weekly crypto investment also surged by 800% in one year, from $3.2 million in 2019 to $30 million per week in 2020.
According to Grayscale’s official, 2020 has not proved a good year for economy and instability due to Coronavirus has caused investors to think about hedging of funds in an attempt to fight the current crisis.
“This has been a record year—a record quarter for us. Candidly, we’ve never seen demand like this before for our products, “Sharif-Askary said. “At the end of the day, our investors are looking to gain exposure to digital assets in a form that doesn’t make them have to buy and store to custody these assets on themselves.”
Investors’ Interest for Altcoins
Last year, the digital asset manager witnessed the funds of $390 million and $110 million for both Grayscale Bitcoin Trust (GBTC) and the Grayscale Ethereum Trust (ETHE) respectively. Sharif-Askary also states that investors’ interest in Bitcoin has now increased as 38% of clients hold altcoins’ assets than just Bitcoin. Institutional investors of course need such assets that “could be used as an inflation hedge in a world where we’re faced with unprecedented monetary stimulus,” she said in the interview.
Recently, a researcher posted on Reddit that Grayscale bought up to 33% of all new-minted Bitcoins in the last three months:
“For good measure, 60k bitcoins in last 100 days is about 33-34% of all newly minted bitcoins in that period, give or take. And Grayscale is just one of the many ETF’s that people who don’t want to fiddle with private keys etc, can use to acquire bitcoin, albeit the largest one.”