➡️ Teeka Tiwari – Investment of the Decade: http://2020.cryptonewsalerts.net
Bitcoin price may hit a $50,000 valuation should institutional investors allocate as little as 1 percent of their net portfolio worth into BTC, says Messari.
The New York-based crypto data aggregator wrote that in an “illustrative analysis,” published on Tuesday.
It discussed a scenario wherein all the institutional investors, including pension funds, endowments & foundations, family offices, and hedge funds, have at least 1 percent exposure in Bitcoin.
The analysis anticipated a capital inflow worth hundreds of billions of dollars into the cryptocurrency market.
It added that the money injection might get further multiplied by 2x-25x due to higher “liquidity and reflexivity.” “
Depending on your assumptions, an aggregate 1% institutional allocation to Bitcoin can easily bring Bitcoin’s market cap above $1 trillion,” wrote Ryan Watkins, a researcher at Messari.
“This is why enthusiasts get so excited about the prospect of institutional inflows. 1% is a lot when everyone does it.”
Messari’s analysis came at a time when Bitcoin is trading 150 percent higher from its yearly lows below $4,000.
The cryptocurrency, nevertheless, repeatedly failed to materialize its bullish bias beyond a specific technical resistance range of $10,000-$10,500.
The limited upside showed that not many mainstream investors are willing to gain exposure in the Bitcoin market.
That is despite a growing optimism regarding Bitcoin’s potential role against an ongoing economic crisis. Mr. Watkins noted that institutions typically invest on behalf of their clients.
They have, therefore, a “fiduciary duty” to invest in assets that yield decent profits but with lower risks.
On the other hand, Bitcoin remains an asset surrounded by red flags related to regulatory uncertainty, infrastructure immaturity, and whatnot. “[Investors] simply cannot bear risk like retail investors can without taking the necessary time and effort to get comfortable,” wrote Mr. Watkins.
But there are exceptions like Paul Tudor Jones, a veteran hedge fund manager who in May allocated 1-3 percent of his $22 billion-portfolio to bitcoin futures. Mr. Watkins cited him and his reasons to invest in a unique asset as a benchmark for other institutional investors.
“Among the most likely to invest in Bitcoin are hedge funds, which have some of the most flexible investment mandates,” he stated.
“Hedge funds can virtually invest in any asset class and financial instrument they agree to with their [limited partnerships].“
In other trending Bitcoin News Today:
People Can Now ‘Buy Bitcoin on Every Block’ Through Network of Major US Retailers and 20,000 Stores
Shoppers in the US can now buy Bitcoin with cash at convenience stores and pharmacy chains.
The mainstream push is through a network of Bitcoin ATMs, cashiers and kiosks operated by Boston-based Libertyx.
It now includes 20,000 7-Eleven, CVS and Rite Aid Pharmacy stores nationwide, where consumers can make BTC purchases on the go.
According to the announcement, Libertyx, which launched its first Bitcoin ATM in 2014, enables people to buy “Bitcoin on every block” at big chains and smaller merchants.
Consumers who download the company’s store locator app are able to navigate to the nearest location to buy BTC.
By offering Bitcoin at a wider network of everyday stores for mainstream shoppers, the company is building critical on-ramps for users who may only be curious about the cryptocurrency and are looking for easy access at a trusted store.
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Show Notes / Resources:
Bitcoin Price Could Hit $50K on Just 1% Institutional Allocation: Messari