Bitcoin Forum

A  JPMorgan statement says bitcoin may find an additional demand of $600B read more... (https://www.bloomberg.com/news/articles/2020-12-14/jpmorgan-says-massmutual-s-bitcoin-foray-signals-widening-demand)
This is due to the recent purchase amounting to $100M of bitcoin by MassMutual a 169 years old insurance firm in Massachusetts.
MassMutual is also listed as the  top 7 Best Life Insurance Companies of 2020 in the US    (https://www.usnews.com/360-reviews/life-insurance/massmutual)
Due to this event, other institutions could follow the steps made by MassMutal, which will greatly increase the demand for bitcoin that consequently increase its value to break the 20k mark. What is your take on this?

We are waiting for many years for the institutional investors to come and buy into Bitcoin.
What I've learned over the years is that this ($600B) doesn't happen overnight and it could actually take years to happen.
Also keep in mind that the more money they have the better they can play some market manipulation to allow them buy cheaper and save a couple of millions here and there.

All in all, try to not have way too big expectations. The when element, when the big pumps would happen is still uncertain. It can be tomorrow or in years, with or without these news.

This is insane and very good for bitcoins. JP Morgan is just one other major American bank to promote bitcoins. With all these banks pushing the bitcoin price it can only go upwards in the future. There are many investors who believe in the JP Morgan research and are going to invest accordingly.

600 billion dollars is a lot of money that is being projected by JP Morgan, that amount can be seen in a two years time if the increase of institutional investors is incremental. This investors definitely know what they are getting into and that is what scaring me the most, as an individual investor, market manipulation will be a bitch if you do not have an insider info which is completely alright with crypto because it is still in a grey area of legality.

It all started with Square Inc. acquisition of bitcoins, and in just a span of a few months we have huge companies looking for their options how to best penetrate the market. Just a year ago the shape of the scene lie dormant, up until someone disrupted the scene with hundreds of millions of dollars worth of bitcoin purchase. Now imagine even if half of that potential 600B comes pouring into the scene, bitcoin’s market cap is effectively doubled by just one industry.

The potential for $100k/bitcoin just got even more higher, and more closer to realization as well.

The news about MassMutual buying 100M USD worth of Bitcoins was "exploited" by all crypto news websites.
The insurance industry has huge potential to create tremendous demand for Bitcoins and pump the BTC price.
Financial institutions like MassMutual investing over 600 billion dollars in the crypto industry would be insane.
However,this doesn't look realistic to me.The authorities(probably SEC) will start whining again about the cryptocurrencies being "too risky",so most of the institutional investors might decide to stay away from the crypto world.
 

JPMorgan Chase & Co is not only one in a series of US banks, but it is the largest in the US and the seventh in the world in terms of total funds. Therefore, their statements carry considerable weight not only in the US market, but around the world.

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It is not even theoretically possible for MassMutual to invest $600 billion in anything when the total value of the company is only $235 billion. The $600 billion estimate comes from the speculation that all similar companies (pension funds & insurance companies) in the US, UK, EU and Japan invest only 1% of their funds in Bitcoin.

This is not impossible at all, and as for the SEC, they have already given approval to each company for such an investment - I don't see why they would suddenly change their minds. The risk in terms of volatility will slowly disappear because it will be increasingly difficult to manipulate the BTC market - such companies invest in the long run and know exactly what they are doing.

Just because companies are getting more and more involved with crypto doesn't mean it will always be like this, I think it just means we are going to see these kinds of days a bit more frequently but it is not going to be additional 600 billion dollars marketcap, it will be a lot less.

There was a test that calculated around 100 million dollars is enough to make bitcoin go 1% higher all by itself, obviously there are market movements and sometimes 100 million dollars would have a bigger impact depending on the market, but on a break even day where bitcoin doesn't move much, that is the secret number. This doesn't mean if you buy 500 million dollars it will go up 5%, it will be probably more, or sell 500 million and go down 5%, they create a wave of buys or sells, but this is the break even change number.

Good news in general and could add some fuel in the bull run.

This demand could be real but will be spread over a decade or more. Institutional investors are slow, very slow. They are forced to follow different rules than millennium kids playing with coins.

You should remember what happened to Bitcoin last time when Goldman Sachs made comment like that... then everyone also was so happy and crazy buying BTC, while GS was selling all BTC for their clients via own subsidiary in Sweden ;)

You better learn the lesson about the intentions and the real actions behind such comments (and especially by such people). They are not stupid to say something good to raise the market price, and then buy for themselves at ATHs.

Not quite sure about this information that's really a huge demand a $600B well I want to know if this were true if yes I really think that the price of Bitcoin will reach moon in no time. Right now we are on All Time High some people are planning to buy more at peak.

Peanuts.
We are talking about peanuts here.
Bitcoin is going to see a massive inflow of money from institutional seeking for an uncorrelated asset.
Ultimately there will be a change in numeraire, where Bitcoin will become the base unit of account.
This is the only way Stock To Flow model can hold true without breaking after a couple of halvings.

Yes, they say that for some purpose. Right now the market is going crazy again with a price of 20,000 USD. After the increase in the price of bitcoins in the market, they may sell their bitcoins so much that the price falls again. Then they buy back at a cheap price. Isn't it very easy to fry prices like that for those well-known companies and those who feel the impact are new buyers, and buyers of coins like me. Be wise in your attitude on every issue that develops, the market may fry hot issues but they turn out to be zonk.

Well.. I am not expecting such a massive inflow, amounting to hundreds of billions of USD. There should be massive global acceptance of Bitcoin, before we can talk about such a move from the hedge funds and wall street giants. Stock markets are being used by billions of people and they have been in existence for many centuries. It will be tough to match them, as far as acceptability is concerned.

It seems crazy to associate an additional demand of $600 billion from a transaction of $100 million - the two figures are so far apart they might as well take a random guess because there doesn't seem to be any real extrapolation actually taking place here. You've always got to wonder how much banks have dumped into Bitcoin when they start hyping it up, as it would make their own assets worth more, that's probably the real driver for publishing such a report.

Do you expect Bitcoin to cannibalize gold's market share? Or do you see them rising together and sucking money from other markets? Maybe a combination of both?

I ask because gold has traditionally been viewed as the quintessential non-correlated asset.


You expect BTC to become the most common unit of account? Do you expect it to be the global reserve currency as well?

just be vigilant in the market esp if you have money on the line. dont believe all the things that you are reading or speculation from "well-known" personalities. be alert of what may or may not happen. if you do want to secure your portfolio, you can sell some of it, and you know for sure, you are already making profit. greed is the common cause of our losses here. so better come up with a decision that you will not regret afterwards.
we will see huge numbers in play here, but the question is, will that really happen? so in either scenario, you should have your own strategies ready to implement with.

The effect will be effective immediately. We will never know how many institutions were already planning to acquire all of the new minted coins. That is what other institutions are doing such as Grayscale. And if all of them starts to buy.
One question is rounding.
Will these exchanges have sufficient bitcoin for them to sell?

Ever since this guys came on board with Bitcoin purchase, there has been lots of pumps with Bitcoin and some few altcoins, everyone should be careful and be on watch when Bitcoin start entering in and out of crypto exchanges. I don't hope the market collapse but if it happens like the past year, the damage wouldn't be good.
I wonder what will happen to the price 9f bitcoin by 2025 :-\ :D

I saw Square's CEO talking about that in a video. He was saying that FOMO was going to be created among institutions inasmuch as other companies were buying and making it public. And he seems to be right. Companies that do not have bitcoin today and see that other companies are buying, in addition to the price increase will begin to think if it will not be better to buy today because tomorrow it will be more expensive.

Absolutely, now it's just FOMO + HYPE + every week news about some X buying Y million / billions worth of BTC. That's quite pretty clear about what is gonna happen next. For sure, BTC might well go even higher than $22.5k, but... eventually those who bought it will start fixing their profits in US$.


I agree, but don't forget that selling too early also can be part of greed bias ;D Imagine you sell @ $22.5k, and then never see BTC lower than $30k in your life... I believe that's not the case, but that's the thinking of newly fleeing "traders/investors" who enter the market now @ ATH.

Ruffer bought 744 million dollars worth of bitcoin in November for example, and as soon as this was made news, the price skyrocket to above 20k price as well. This wasn't direct as you can see, why? Because if it was Ruffer that made it over 20k+ that would mean they would have done it in November, they didn't buy yesterday, they bought in November so a month ago, but the price reacted to this news yesterday, which means there is a bigger correlation to price increases in bitcoin to the "news" of big deals instead of the big deals themselves.

These kinds of moves will surely increase bitcoin market cap, maybe it will do it a month later, maybe it will do it that day, but whenever something big happens that doesn't change much but the news of it changes a lot.

Any news like this is undeniably positive, but Grayscale has been buying much larger quantities of BTC all this year, and MicroStrategy and its investments have not had an instant impact on price even though they were released in real time. After all, this is the first time I've heard of this - I haven't read anywhere on the forum that anyone posted this news.

Why would the purchase of 45 000 BTC be anything more significant than all the other investments measured in billions of $ throughout this year? The only thing that comes to my mind is that this news has had an impact on the crypto market in Europe - so far it has been more or less focused on the US big companies.

I don't think that Grayscale/MicroStrategy are purchasing these coins in one go. They may have spread their purchases over many months. Because there is only limited liquidity at the Bitcoin markets, and hundreds of millions of $$$, if poured within a short period can cause a severe supply crunch. Also, there is a lot of trade happening outside the major exchanges. For example, the Chinese authorities recently dumped a large stash (which they seized from the PlusToken scammers).  

It is nice to see that they are finally accepting the inevitable truth, we know this was going to happen, the banking industry tried to fight bitcoin at every opportunity and they realized they cannot win so now they are joining hoping to obtain great profits and at the same time to try to subvert the market, but while they will certainly get profits they will not succeed in subverting the market and they will be the ones subverted by bitcoin, it will not be fast but I think it is inevitable.

Because demand is very much influenced by people's knowledge, if people don't know the news then demand will remain stagnant to a certain level, cmiw. The last big purchase had a big enough impact because it was quite hype, where big parties allocate large funds to bitcoin, so people will think that bitcoin has a better value than what they think, so indirectly demand will increase drastically

Wow.

I'm quite familiar with MassMutual (by name at least; I'm not one of their customers), and this is quite surprising that they'd be bullish enough on bitcoin to plop that kind of money down on a risky bet--but I'm starting to think that these large corporations that have been getting into bitcoin may know something bad is looming in the economy.  Specifically I'm thinking that the USD is in danger--and to anyone who's been following the rampant money-printing that's been going on for years now that shouldn't come as a shock, but somehow I'm starting to think that there might be an impending inflation crisis coming sooner rather than later.

There's no other reason I can think of for companies like MassMutual to be getting into bitcoin.  They're not in the business of gambling on extremely volatile assets like bitcoin, so it makes me scratch my head a bit when I read stories like this.  It also makes me shudder just a little.

While I think the system is screwed and CB's are playing a dangerous game, printing money and artificially distorting markets; I also think that US Government knows perfectly how the USD dollar a crucial part of US Success as world leading super power.
They wont be caught offguard by a Dollar inflation in any way, believe me.

Here we can rather talk about indirect demand from other major market players, and not about the euphoria of a crowd of small investors. It is a little alarming that the current wave-like movements of the bitcoin exchange rate strongly resemble the events of 2017 - in 2017, since March, bitcoin has risen in price by 19 thousand, and this year since March, the price increase was 19.9 thousand. how it ended in the end, i think it is not necessary to remind much, however, unlike the current period, there was not such a large entry into the market of institutional investors, which allows us to hope not for such a strong correction later.

When it comes to Ruffer, the amount they bought was 45 000 BTC (although I don’t know if they bought it all at once), but the first purchase MicroStrategy made was $250 million where the average price of BTC was around $11 000, which amounted to 21 454 BTC. Shortly afterwards, another purchase of nearly $200 million followed - but all of this caused nothing like a recent pump.

Given the hundreds of thousands of BTC bought by large investors over the past 6 months, I want to say that 45 000 BTC is not something that can make that much of a difference.


This news has not been confirmed, it is a rumor, and it will be difficult to find out the truth of what exactly happened. If a sale did occur, it occurred via OTC and had no impact on price.

Of course Microstrategy's buys impacted price. You can't buy 40K coins in this market without moving it. Coinbase was literally routing orders through exchanges because there was not enough OTC supply. That would have pushed spot prices up.

Even if it was all done OTC, Microstrategy buying up all available OTC supply would have forced other OTC buyers to buy on exchanges, indirectly pushing prices up.

Grayscale is also only acquiring them on behalf of clients much like Ruffer. If Ruffer had gone through GBTC, that order would have represented a significant chunk of all the BTC Grayscale placed this year.

Many more demands will really help increase the price of Bitcoin. This will lead to the necessity of the BTC to be as high as what we really expect.
However, will it really pump the price? We may not know exactly but at least, it will add to the demand for the BTC.

You are right, right now, many institutions, industries, and also other companies are opened tot eh information, utility, and also trust in Bitcoin. Many of them are starting to reach and accept BTC. this is actually a really good situation because this will make a positive uptrend in the market. However, if it will be going to the market correction, will be they in common condition?

It is still possible to purchase Bitcoin from OTC sources, rather than doing it through exchanges. But given the limited liquidity, it is not possible to purchase tens of thousands of coins in one go. I checked the post from Lucius, and it looks as if they made a series of small purchases spread over a period of many months. Anyway, we can be sure about one thing. The additional supply in the market has almost dried up.

I may find it quite ironic because of the fact that JPMorgan is one of the best enemies of Bitcoin back in the days where Bitcoin is starting to boom :D.
Now they are supporting the thing that they are against with.

With regards to the institutions investing into Bitcoin, we have waited this for a long time already and now is the time for them to invest and support Bitcoin. This institutions will play a huge role towards the price movement of Bitcoin. It may go up or down depending on them since they got a very large Bitcoin holdings. I may see this as a good news for now but in a few months this will not be a good thing as they can sell the Bitcoins that they are holding.

Yes, I'm talking about the cumulative effect of those buys. Price is based on supply and demand. You can't remove 40K coins from the supply without affecting price.

Plus, we're talking about very big buys. Their initial investment was ~20K coins (based on back of the envelope math) over a 5-day period in August. https://www.coindesk.com/microstrategy-used-coinbase-for-massive-bitcoin-purchase

That's true. The cumulative impact from these purchases are going to linger around for some time. And now the situation has been completely reversed, from what we had during the beginning of 2020. At the start of this year, there were indications that there was an oversupply of Bitcoins in the market. As a result, BTC was struggling to keep above the $10,000 per coin level. The situation has reversed now, as it looks as if a supply crunch is there in the exchanges.

As I constantly say that such news will appear more and more often, since all prerequisites lead to this. Bitcoin will surely only grow in price, many billionaires will be more and more positively disposed towards investing in bitcoin, and indeed in cryptocurrency in general, not only in bitcoin. Many people are herd instincts, and billionaires are no exception. Many of them will look at other large investors and also invest without hesitation.