Institutional Investors Pour $498,900,000 Into Bitcoin (BTC) and Ethereum (ETH) As Crypto Fund Executive Declares ‘Cats Out of the Bag’

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A token representing Bitcoin virtual currency sits among cables and LED lighting inside a 'mining rig' computer in this arranged photograph in Budapest, Hungary, on Wednesday, Jan. 31, 2018. Cryptocurrencies are not living up to their comparisons with gold as a store of value, tumbling Monday as an equities sell-off in Asia extended the biggest rout in global stocks in two years. Photographer: Akos Stiller/Bloomberg via Getty Images

New numbers from the digital asset management giant Grayscale show investors are collectively throwing big money into Ethereum for the first time, on top of record investment numbers for Bitcoin.

According to Grayscale’s Q1 2020 report, institutions are taking a serious interest in ETH, enough to print a record quarterly inflow into the Grayscale Ethereum Trust.

Spencer Noon, the head of crypto investments at DTC Capital, says the numbers show Ethereum has reached a turning point with high-net worth investors.

“Institutional investors are buying ETH. The cat is officially out of the bag. From the latest Grayscale report:

[Grayscale] Ethereum Trust saw $110M in Q1 inflows. This is more than all of its previous inflows combined for the past 2 years ($95.8M).”

In the weeks prior to the end of the quarter, inflows into Ethereum actually surpassed Bitcoin.

Across the entire quarter, investors poured a record $389 million into the Grayscale Bitcoin Trust in addition to the $110 million invested in the Grayscale Ethereum Trust – for a total of $498.9 million.

Grayscale’s digital asset trusts are all fully backed by real cryptocurrency. Across all of its products, which also offer exposure to XRP, Bitcoin Cash, Litecoin, Ethereum Classic, Stellar Lumens, Zcash and Horizen, Grayscale reports a record inflow total of $503.7 million.

The firm says investors are turning to its products despite a low appetite for risk in this shaky global macro environment.

“Investors are tactically using drawdowns to increase their exposure to the asset class, even in a ‘riskoff’ environment. Our institutional investor segment also continued to expand, a trend that could gain additional momentum as legacy financial institutions reinforce the investment thesis for the asset class.

Additionally, as existing investors allocate to multiple products, the investment community should monitor the expansion of increased demand for diversification within the asset class.”

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