Institutional investors are increasing their positions in Bitcoin and accelerating the deployment of Ethereum
The halving of Bitcoin is not only a topic of concern to us ordinary investors, but also a topic of concern to Wall Street and technology leaders. According to recent related news, CashApp and Grayscale purchased 52.56% of all newly mined bitcoins in the first quarter of this year, of which 29.41% were purchased by Grayscale and 23.15% were purchased by CashApp.
According to the current block production speed and block rewards of Bitcoin,Grayscale and CashApp bought 47,600 and 37,500 bitcoins, respectively, in the first quarter.
CashApp is a payment-focused company controlled by Twitter CEO Jack Dorsey, which provides services for the public to buy Bitcoin. We all know that Twitter is the most popular instant messaging software overseas, and it is the out-and-out "WeChat" overseas.
Jack Dorsey has always been known in the circle to be optimistic about Bitcoin. He even thinks that any other digital currency including Ethereum is meaningless, only Bitcoin is needed.
Under the vigorous promotion of Jack Dorsey, CashApp has also developed very rapidly in the field of Bitcoin transactions. Therefore, it is not surprising that so many bitcoins were purchased in the first quarter.
When it comes to grayscale, we are more familiar with it. In previous articles, I have introduced grayscale data many times to illustrate the investment of foreign institutional investors in digital currency.
The data in the table below is the status of capital inflows into various digital currency assets reported by Grayscale in the first quarter.
From the above data, we can see three obvious rules:
1. In the investment allocation of Grayscale, the ratio of Bitcoin and Ethereum is about 4:1. The funds to buy Bitcoin are about 400 million US dollars, and the funds to buy Ethereum are about 100 million US dollars.
2.Since January 28, 2020, the speed of capital inflow into Ethereum has been much greater than the speed of inflow into Bitcoin. Especially after March 20, the speed of capital inflow into Bitcoin has hardly changed much, while the speed of capital inflow into Ethereum speed is accelerating.
This shows that big money and institutional investors began to turn their attention to Ethereum as early as 2 months ago. This is consistent with my point in yesterday's article "Bitcoin returns to $10,000, Ethereum's future growth potential is clearer". These big institutions realized this even earlier.
3. Everyone pay attention to the time points I marked in red circles in the picture, which are every week from January 21st to March 10th. The reason I marked those time periods is that money was flowing into Bitcoin during those few weeks. And the largest inflows are on January 21 and January 28. The amount of funds flowing into Bitcoin in these two weeks accounted for 50% of the first quarter.
So what is the price at which nearly 50% of institutional funds buy Bitcoin? Let's look at the price chart of coinmarketcap.com below:
We can see from the figure that the lowest price of Bitcoin during this period was $8,200, while the highest price was $9,100. thereforeThe price for institutional investors to enter the market on a large scale is actually not low.
It is particularly worth noting that after the plunge on March 12, Bitcoin once fell below $5,000 and hovered below $7,000 for a long time. This price is far lower than the price at which institutional investors once entered the market. Join the pace of entering the market.
I think this is mainly due to the stock market crash in the general environment at that time. Investors were extremely cautious or even pessimistic about the future, so they mainly held cash instead of investing in the market.
Therefore, to sum up, institutional investors are still increasing their positions in Bitcoin and accelerating the deployment of Ethereum.
