It is analyzed that the proportion of institutional investors in the bitcoin market is still only 1%. Although institutional bitcoin incorporation is increasing, it is still very small. It is predicted that the inflow of large institutional funds will be difficult unless the infamous volatility decreases.
In an interview with CNBC on the 11th, Jeff Curry, head of research in the raw materials division of Goldman Sachs, said, “The bitcoin market is showing signs of maturity, but the proportion of institutional investors is still very small.”
Bitcoin prices continued to surge in the second half of last year, and on the 9th, the price of bitcoin rose to nearly 40 million dollars. However, it plunged this week and dropped to the $30,000 level on the 12th, and it is in the $32,000 range as of 10 am on the 13th.
“There is a risk of volatility and associated risks in all early markets,” Curry said. “The key to market stability is seeing an increase in institutional investor participation,” he said. “Right now, only about 1% of the more than $600 billion invested in Bitcoin is institutional money.”
Since the end of last year, famous Wall Street institutional investors such as Paul Tudor Jones and Stanley Drunken Miller have started investing in bitcoin. In addition, Skybridge Capital invested $182 million (as of December last year) and Mathmual invested $100 million in Bitcoin. Guggenheim Partners is reportedly investing up to 10% of the $5 billion macro fund in total assets under management.
JP Morgan recently analyzed that Bitcoin is competing with gold as a safe asset, and theoretically, it could rise to $146,000 in the long run. However, he stressed that in order to get there, price volatility will drop sharply and institutional investors must be trusted enough to make large-scale investments.
Bitcoin has exhibited great volatility not only this time but also during that time. It soared close to $20,000 in 2017 and dropped to $3122. “In the long run, Bitcoin will be able to find an equilibrium,” Curry said. “The current level of volatility and uncertainty makes predictions very difficult.”
Reporter Kim Hyun-seok [email protected]
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