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Institutional investors & cryptocurrency market

04/16/2019
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Although the year 2018 was not the easiest for the cryptocurrency market, institutional investors and private funds showed great interest in these assets. In all likelihood, by 2019 they will completely change the balance of power between buyers and sellers.

Global Custodian, The TRADE Crypto and BitGo Survey

According to a survey of 150 endowment funds and trust capital management funds, 94% of them invested in cryptocurrency. At the same time, only 54% of respondents bought real assets, the rest used derivative financial instruments.

Endowment funds are non-profit organizations that manage funds to finance social and charitable institutions. Also used to provide scientific research and educational programs.

However, more important is the fact that more than half of the respondents reported plans to increase the allocation of funds to cryptocurrency assets. That is, even a not very successful year 2018 did not lead to disappointment. The survey participants were not even stopped by the fact that there is currently not enough infrastructure to buy cryptocurrency-based securities.

Institutional Investors, IMF and Cryptocurrency

The International Monetary Fund conducted its own survey. Of the 37,660 unique Twitter users, 56% are sure that in five years they will pay for purchases with cryptocurrencies. The head of the IMF, Christine Lagarde, said that such results reflect the real situation in the world. In addition, she expressed confidence in the success of the project JPM Coin. However, it was added - institutional investors would primarily profit from it.

The head of the International Monetary Fund Christine Lagarde is a supporter of the development of cryptocurrency. Back in 2017, the IMF recommended that governments consider introducing state-owned cryptocurrency assets.

The US Commodity and Futures Trading Commission notes that interest in new financial instruments is growing every day. Thus, over the past two weeks, the number of long positions on the CME exchange has increased by 88%, and the volume of sell orders has decreased by 88%. But the problem is that institutional investors now do not have all the necessary infrastructure for full-fledged trading.

So far, the SEC has not authorized the use of Bitcoin-ETF contracts. However, the concerns of the regulator are grounded. The custodial services for the storage of cryptocurrency are just beginning to develop, and the situation with the price increase in early April proved the possibility of manipulating this market.

Insurance and pension funds in the cryptocurrency market

French lawmakers have allowed insurance funds to invest in cryptocurrency financial assets. This truly breakthrough event will provide markets with access to a huge amount of liquidity.

French insurance funds manage capital at 1.77 trillion Euros. The total capitalization of the cryptocurrency market now stands at about 150 billion Euros.

Such a huge liquidity potential can radically change the balance of power. If public opinion makes Bitcoin a tool for storing capital, the price of $ 10-20 thousand will seem more than objective. However, some experts go even further. JPMorgan analyst Tom Lee is sure that even now the objective cost of bitcoin is $ 14,000. And very soon it will overcome this barrier.

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