Lack of retail interest indicates increased institutional flow into Bitcoin

[NightTrader0]

Interesting article here on how retail are still not interested in crypto (compared to 2017), even though price has risen by 320% this year.

https://coinrivet.com/lack-of-retail-interest-indicates-increased-institutional-flow-into-bitcoin/

[yesyes18]

a number of reasons could be responsible for that.  Personally, I think what actually helped the 2017 retail influx was through the altcoins but this recent pump had not the ALTs respond so I wouldn't be surprised. The uprise was in a way related to the fact that many enthusiasts were dumping their alts for Bitcoin. Anyways we're still way up checking from year to date so things still look good in my perspective.

[timerland]

Great article, thanks for linking it.

I'd guess the reason for the lack of retail investments to be due to the last times bull run, where most people only thought BTC could go up and where then burned when it dropped from $20,000 to $5,000 in a month.

Institutional investors are much smarter and will probably understand the risks behind buying cryptocurrencies and will be more prepared then the average joe.

Also, I don't think a lot of institutions invested in ICOs, most of them where regular people. Possibly with crowdfunding dying down, people are less interested in ICO's and cryptos.

I'd like to see some articles outlining why institutions are interested in BTC right now, it could be very interesting to read.

[killat]

Ironically, bitcoin is more secure than most countries' own currencies. It's also a genie that is impossible to put back in the bottle. You would have to wipe out all computers utilizing the bitcoin and the entire global network they share to get rid of bitcoin.

[NightTrader0]

Great article, thanks for linking it.

I'd guess the reason for the lack of retail investments to be due to the last times bull run, where most people only thought BTC could go up and where then burned when it dropped from $20,000 to $5,000 in a month.

Institutional investors are much smarter and will probably understand the risks behind buying cryptocurrencies and will be more prepared then the average joe.

Also, I don't think a lot of institutions invested in ICOs, most of them where regular people. Possibly with crowdfunding dying down, people are less interested in ICO's and cryptos.

I'd like to see some articles outlining why institutions are interested in BTC right now, it could be very interesting to read.

I tend to agree. Retail investors who got burned will probably only buy back when FOMO sets in above 20k. I think it's safe to say there's a pretty rocky path ahead for ICOs and altcoins as institutions focus on Bitcoin.

[Yamifoud]

Institutional interest might be able to bring good in the market but it looks like they'll never have that strong commitment at this time.

They know probably the risk and we'll prepared for it but I feel also that they are afraid for the possible losses that they might experience. This will be a reason for them to hold and wait for the market to drop down before they buy crypto.

[franky1]

4 years ago exchanges had good volume. but now there are so many exchanges. there has been a dilution of TRUE volume. the majority of the fluffed up volume is day traders using altcoins/stablecoins to arbitrage.

there is not really a big jump in adoption but just a change in the scales of day traders. which with less coin on exchanges. makes it easier to get prices moving

[yoseph]

Ironically, bitcoin is more secure than most countries' own currencies. It's also a genie that is impossible to put back in the bottle. You would have to wipe out all computers utilizing the bitcoin and the entire global network they share to get rid of bitcoin.

In Africa for example where most currenicies are weak, people end up saving their money in Bitcoin wallets because they tend to lose value when they save at their local banks. Banks are also not reliable since most of them are being closed down on a daily basis making depositors losing all their money.

[Lucius]

I'd guess the reason for the lack of retail investments to be due to the last times bull run, where most people only thought BTC could go up and where then burned when it dropped from $20,000 to $5,000 in a month.

It's not true that Bitcoin is drop from $20k to $5k in a month as you say, first time price is go so low was in November 2018, and from December 17 when we have ATH it is hold above $15k until January 7, 2018 so anyone who know anything about the crypto market had enough time to make a safe exit.

I agree that big money was probably the cause of Bitcoin jump from $3000 to $14 000 in just few months, but it was some kind of test since they stop at one point. Even if they buying with help of OTC, when buying large quantities of something that has a limited supply, it must have an impact on the price. Maybe they change strategy, buying smaller quantities ensures a stable /lower price, and they have it now.

[kryptqnick]

So institutions believe in Bitcoin, whereas regular people and retailers are not interested. I think it makes sense. Institutions are interested in profits, they see an opportunity with Bitcoin as something that is on average rising every year at very high rates. Retailers, on the other hand, have their own goods/services to sell, and what they need is simply people interested to buy them. Bitcoin for them is something extremely risky, because of high volatility. It is also something that takes more time and sometimes more money than traditional payment methods. With people not even being interested to use it as money, there's no reason for retailers to adopt Bitcoin.

[deisik]

In Africa for example where most currenicies are weak, people end up saving their money in Bitcoin wallets because they tend to lose value when they save at their local banks

Are you sure about that?

Since in countries where local currencies fail massively (and constantly), people start using in their everyday activities the ever-alive American dollar or a currency of a neighbor country which is the stablest in the neighborhood (in Africa specifically, it is the South African rand). One of the most notable examples of this kind is Venezuela, with their local currency (the Venezuelan bolivar) losing value like shit. People in such countries are too poor and simply don't have spare money to invest in crypto. Basically, they have nothing to save, let alone save in Bitcoin (as altcoins are cheaper and thus more available to the impoverished populace)

[gentlemand]

Are you sure about that?

Total rubbish. Everyone wants dollars. You can obtain or get rid of a dollar anywhere in the world. Someone is guaranteed to have some or want some. You might find 0.1% of the same people willing to consider BTC.

Coinbase's 200-400 million figure presumably means custody deposits rather than sales. Those coins might have been bought years ago.

My take is on this area is - the freaks are the ones who dragged it up from nothing. Big bucks will gradually take over but it still won't be enticing enough for average people. Big bucks will then package and feed it back to the little guy who will be told it's what they've always wanted. And they'll agree.

[d5000]

Great article

At the contrary, I consider this article a bad one. Almost "Bitcoin.com" level

It parts from a Google Trends observation as an indicator for "retail interest", which is highly speculative. First, Google searches for Bitcoin are often related to speculation by Average Joes, not to cryptocurrency usage in the retail sector. They may however use the word "retail" in the sense of "small investors".

But not even the Google Trends observation is really correct. As we can see in the chart displayed in the article, the interest in Bitcoin is growing, and at a pretty good pace (it has aproximately doubled in comparison to late 2018). In 2017, Bitcoin's bubble (and the subsequent crash) was in all the media, and that explains the very short (1-2 months) spike in the Google Trends chart. Most people probably didn't search for it because of genuine interest in investing or using it but instead simply because everybody was talking about it and they wanted to know what it was about.

Then we have tweets about "institutional investors" as an indication for interest in Bitcoin. Well. Specialized Bitcoin "institutional" investors (like Grayscale) have existed since at least 2013. And their nice numbers, measured in US dollars, are mostly growing because the BTC prices are rising. The only item supporting their theory is the Bitcoin engagement by Fidelity, which was ... last year (as they also write, but it doesn't support their theory at all).

As a conclusion, I think the connection they draw between "retail" and "institutional" investors is extremely speculative.

[figmentofmyass]

It parts from a Google Trends observation as an indicator for "retail interest", which is highly speculative. First, Google searches for Bitcoin are often related to speculation by Average Joes, not to cryptocurrency usage in the retail sector. They may however use the word "retail" in the sense of "small investors".

that's what they're talking about---retail vs institutional investors.

none of this is surprising. it's institutional buyers (not small fish) who usually load up during the bearish/boring stages of the market cycle. retail comes later. retail interest usually spikes in the later stages of a bull market when hype is strongest.

right now the altcoin market is dead, google trends is dead, the forum and crypto twitter is dead. these are still the early stages of the bull market. we're still a ways off (several months at least) from the sort of retail hype we saw during 2017.

[d5000]

right now the altcoin market is dead, google trends is dead, the forum and crypto twitter is dead. these are still the early stages of the bull market. we're still a ways off (several months at least) from the sort of retail hype we saw during 2017.

With respect to the altcoin market, you may be right. In my opinion it was fueled by the ICO bubble and mainly by Ethereum, and now we have learnt that the "easy money" wasn't so easy

But with respect to Bitcoin, just the Google Trends chart shows that interest is growing again since late February 2019 approximately. We're again at mid-2017 levels, when the sentiment was already clearly bullish. Only the three most bubblish months in late 2017/early 2018 had higher interest levels, and as I wrote I think most of that was interest in Bitcoin as a "novelty", not as a potential investment idea. And those that invested in those months most likely got burnt. So the current Google Trends "level" is far from being "dead". It is already at a bullish level.

[pooya87]

I agree that big money was probably the cause of Bitcoin jump from $3000 to $14 000 in just few months, but it was some kind of test since they stop at one point. Even if they buying with help of OTC, when buying large quantities of something that has a limited supply, it must have an impact on the price. Maybe they change strategy, buying smaller quantities ensures a stable /lower price, and they have it now.

the reason for that jump was because it was a correction not a rise. when price was pushed down below $6k it became unstable even though it lasted a while and at the time it didn't seem like it. that is why i have been calling it a reverse bubble. as it pops, just like a regular bubble,  the reversal is fast and big because money is running in just like bubbles where it is running out.

[timerland]

I tend to agree. Retail investors who got burned will probably only buy back when FOMO sets in above 20k. I think it's safe to say there's a pretty rocky path ahead for ICOs and altcoins as institutions focus on Bitcoin.

It's already become apparent with the amount of ICO's and IEO's occuring nowadays, compared to a year back. What saddens me, is that there are probably investors who became exposed to crypto via ICO's, lost money from the ICO's and likely exited crypto with a sour taste.

It's not true that Bitcoin is drop from $20k to $5k in a month as you say, first time price is go so low was in November 2018, and from December 17 when we have ATH it is hold above $15k until January 7, 2018 so anyone who know anything about the crypto market had enough time to make a safe exit.

I agree that big money was probably the cause of Bitcoin jump from $3000 to $14 000 in just few months, but it was some kind of test since they stop at one point. Even if they buying with help of OTC, when buying large quantities of something that has a limited supply, it must have an impact on the price. Maybe they change strategy, buying smaller quantities ensures a stable /lower price, and they have it now.

Ah, gross exaggeration from my part, sorry. I think OTC has been even harder for people to execute over recent months (look at the recent case of localbitcoins deleting cash trades), but institutional investments have definitely been a big part of the price climb over recent months.

Great article

At the contrary, I consider this article a bad one. Almost "Bitcoin.com" level

It parts from a Google Trends observation as an indicator for "retail interest", which is highly speculative. First, Google searches for Bitcoin are often related to speculation by Average Joes, not to cryptocurrency usage in the retail sector. They may however use the word "retail" in the sense of "small investors".

But not even the Google Trends observation is really correct. As we can see in the chart displayed in the article, the interest in Bitcoin is growing, and at a pretty good pace (it has aproximately doubled in comparison to late 2018). In 2017, Bitcoin's bubble (and the subsequent crash) was in all the media, and that explains the very short (1-2 months) spike in the Google Trends chart. Most people probably didn't search for it because of genuine interest in investing or using it but instead simply because everybody was talking about it and they wanted to know what it was about.

Then we have tweets about "institutional investors" as an indication for interest in Bitcoin. Well. Specialized Bitcoin "institutional" investors (like Grayscale) have existed since at least 2013. And their nice numbers, measured in US dollars, are mostly growing because the BTC prices are rising. The only item supporting their theory is the Bitcoin engagement by Fidelity, which was ... last year (as they also write, but it doesn't support their theory at all).

As a conclusion, I think the connection they draw between "retail" and "institutional" investors is extremely speculative.

I understand the point your making here, and I don't think using google trends is the best basis for a factual article, but taking it with a grain of salt, I'd still speculate that institutional investments have been crucial for BTC's recent price growth.

It'll be way better if the article clarified "retail", and "institutional" investments, but it's still possible to draw a conclusion from blurry facts.

[leea-1334]

That to me is mainly because retail people are no longer totally new to Bitcoin. They probably heard about how BTC was 20k 2 years ago and they think now is just only half of that and do not think it will rise again.

The same as 2 years ago they heard of ETH and other altcoins going x100 or more. Now they hear it is going down and down. So of course no interest!

[SquallLeonhart]

Interesting article here on how retail are still not interested in crypto (compared to 2017), even though price has risen by 320% this year.

https://coinrivet.com/lack-of-retail-interest-indicates-increased-institutional-flow-into-bitcoin/

You know that in a software that is called sketch up, there is a tool that is called follow me, and every direction you go is where whatever the follow me tool is pulling goes. This current rate actually is the right statistic, and the right level, cryptocurrency is a new system and not meant to grow easily like that as it will take a gradual inflow, and the reason why we see so much inflow of retail in that 2017 was just because the hype was quite strong, and the interest of investors in those retail businesses too was quite very strong.

Since the market has been met with lots of discouragement as a result of some illegal activities that is being din through the ICO market, most investors are already discouraged and they are also discouraging the retail companies from making a try, which is why we have seen decline in their involvement now.

[avikz]

That to me is mainly because retail people are no longer totally new to Bitcoin. They probably heard about how BTC was 20k 2 years ago and they think now is just only half of that and do not think it will rise again.

The same as 2 years ago they heard of ETH and other altcoins going x100 or more. Now they hear it is going down and down. So of course no interest!

It is probably one of the reasons for less interest from the mass, but that's the viewpoint of an investors. A merchant will not think in this similar line because bitcoin is not an investment to them. What matters to them is the stability in price which is certainly missing in crypto market for very obvious reasons!

There are other reasons as well for the retail segment. The primary one is the absence of government regulations and framework of crypto usage. Very few countries have a proper framework for using crypto and retail business is an organized business segment. So an organized business segment would never adopt something into their business which doesn't have a framework available! That's where the adoption rate is getting hindered!