Part 5 #StartInvestingInCrypto

3. Demand from Institutional Investors

For all these years Bitcoin was mainly an asset that was speculated by retail investors.

But due to COVID and the great monetary inflation, every fund manager has to educate themselves about Bitcoin. And make an appropriate allocation for it as they have a fiduciary responsibility to invest in assets to protect and grow wealth.

Especially, in the current environment where interest rates are zero if not negative in some countries and bond yields are near 0. They are running out of assets that are good stores of value. As pomp says

We are entering a period of time where it is becoming more risky to NOT own Bitcoin, rather than having it considered risky to own the asset.

When institutions invest in Bitcoin they are not putting small ticket sizes. Due to their fund sizes and return profiles, they have to allocate hundreds of millions of dollars if not billions into an asset to make any meaningful impact on their portfolio.

Microstrategy: A publicly traded business intelligence software company has invested over $1B into Bitcoin

Square: Another publicly listed company put $50M into bitcoin — about 1% of its assets.

Infamous hedge fund billionaire Paul Tudor Jones has put 1%-2% of his assets in Bitcoin

169-Year-Old MassMutual Invests $100 Million in Bitcoin

These fund managers won’t put hundreds of millions of dollars in something without doing their due diligence. It’s a great validation for Bitcoin to get these institutional buy-ins.

It is a ridiculous reflexive loop — when you’ve got the best performing asset class on earth whose market cap is now investable by institutions, it drags in institutions, which brings the market up, which drags institutions, that cycle is to play out and hasn't even started.