Growing number of institutionnal investors

[LeGaulois]

Very high numbers, to be honest, it's surprised me. Imagine what the percentages will be in 5 years from now if the trend continues. A result from a survey from Fidelity shows more institutional investors think cryptocurrencies should be added to their investment portfolio.

“These results confirm a trend we are seeing in the market towards greater interest in and acceptance of digital assets as a new investable asset class,”

TLTR :

~800 EU & US participated in.

- 75% of Americans and 82% of Europeans are interested in these assets

- Stateless currencies: 25% of Europeans see this as a good aspect

- 36% of them invested in cryptocurrencies, directly or via derivatives. (27% in The US and 45% in Europe. It 's clear EU is smarter than US, ok just joking, or not)

- 80% did it because it's/has
   * uncorrelated to other asset classes 36%
   * innovative technology 34%
   * the high potential 33%

- 91% of them would like in the next 5 years cryptos represent at least 0.5% of their portfolio.

What is stopping them?
- market manipulation
- lack of knowledge
- volatility

“Investor concerns are largely focused on issues that will resolve themselves as the
market infrastructure evolves,”

https://www.fidelitydigitalassets.com/bin-public/060_www_fidelity_com/documents/FDAS/institutional-investor-study.pdf

[bitmover]

I believe institutional investors will continue to come, basically to two factors. Ofc this is just my opinion:


1 - Zero or even negative interest rates.  As interest rates are too low, instutional investors are going more and more to stocks.

2 -  but Stock market is too volatile (as we saw in corona virus crisis). This is why they are taking a look at gold and silver, and the most obvious alternative to those is bitcoin.
You can take a look at this picture just for an example.


source: http://www.worldgovernmentbonds.com/

I believe holding will be very rewarding in a not distant future.

[Febo]

Growing number of institutionnal investors

The only logical next step to happen is that institutional investors get bigger share of Bitcoin. That will be the fuel for next bull market.

[joniboini]

2 -  but Stock market is too volatile (as we saw in corona virus crisis). This is why they are taking a look at gold and silver, and the most obvious alternative to those is bitcoin.

As mentioned in the OP, I think those investors believe that bitcoin is way more volatile. Double-digit growth or loss is a common occurrence. But I think this is how the market works for now. The risk are higher but it's more rewarding. This is why their holding target is not that big yet, as throwing too much money might cause them a headache.

The only logical next step to happen is that institutional investors get bigger share of Bitcoin. That will be the fuel for next bull market.

Or the average joe sees the news, believe those investors will buy more, start buying more, pumping the price while the big guy is waiting for a perfect entry to exit the market as usual.

[avikz]

Growing institutional interest on bitcoin is a good news. While this interest may fuel the next bull run but at the same time, it may also fuel mass adoption that may have lasting effect on bitcoin.

In many countries, bitcoin's reputation is not good as it has been involved in so many hacking incidents, ransomware attacks and illegal money laundering incidents. So common mass in their middle ages usually stays away from it. But that scenario may change if institutional investors pour money into bitcoin. That will bring back the trust factor in bitcoin market.

So in general, it's a good news for the entire community. Growing institutional interest won't make bitcoin centralized, rather infuse more liquidity into it!

[mariah.sadio]

In my opinion true institutionnal will never invest in btc. They will prefer 30 years bonds

[exstasie]

- 75% of Americans and 82% of Europeans are interested in these assets

- 36% of them invested in cryptocurrencies, directly or via derivatives. (27% in The US and 45% in Europe. It 's clear EU is smarter than US, ok just joking, or not)

- 91% of them would like in the next 5 years cryptos represent at least 0.5% of their portfolio.

Refreshing counterpoint to Goldman Sachs' recent report, thanks for sharing! This agrees with my belief that institutions and high wealth investors have been quietly dipping their toes into the BTC market, if not outright accumulating. It's difficult to see the tide turning back at this point.

0.5% or 1% of multi-billion (or trillion) dollar funds is no trivial matter. That will seriously move the market as institutional adoption crosses the chasm from "early adopter" to "early majority." Just imagine when firms like Blackrock enter the market.

[mnporter2001]

This is a good sign for traders and holders like us. I feel that this market needs more people to not be strongly controlled from those who have a lot of money. This is actually a very interesting market and it is for people who are interested in high risk and high profit. That's why many people around the world increasingly want to participate in the crypto market. Another fun thing is that newbies who enter the market will be fomo mentally. Bitcoin halving just happened so they will buy bitcoins continuously and then we can sell bitcoin at a high price. 

[so98nn]

1 - Zero or even negative interest rates.  As interest rates are too low, instutional investors are going more and more to stocks.

Correct. This can happen in the first place rather it might be the case in current scenario. Who wouldn't want to invest in such low time IF they have got money in their pockets. I'm pretty sure big guys will lure the market with their crude investment when stocks are going zeros. Economic crisis is first step where thoughtful investment can be done easily to avail profits in future.

No stock is gonna stay zero forever, no stock will stay steady for long time. So it's just about the time when everything resets and people go on earning profits. Loads of it.

So yes, institutional investors outbreak is real.  

[Naida_BR]

From being interested than investing really it is a long way to go.
Institutional investors are growing but they are not really investing and if the time comes for that they do not invest a lot of money, they are afraid to take the high risk especially for the cryptocurrency assets.

[Febo]

The only logical next step to happen is that institutional investors get bigger share of Bitcoin. That will be the fuel for next bull market.

Or the average joe sees the news, believe those investors will buy more, start buying more, pumping the price while the big guy is waiting for a perfect entry to exit the market as usual.

Exit to where?  There is nowhere to exit. Bitcoin is safe heaven. They are allready full of gold. What they will buy shares that are in huge bubble? Real estate that is in huge bubble also. They will keep fiat that will devalue soon. Bitcoin is exit.

[roberthays]

I can see this growing more and more. Once Bakkt becomes more popular it will only increase the amount of institutional investors and fuel more innovation too.

[LeGaulois]

From being interested than investing really it is a long way to go.
Institutional investors are growing but they are not really investing and if the time comes for that they do not invest a lot of money, they are afraid to take the high risk especially for the cryptocurrency assets.

I wouldn't say there is "a long way". Look, the survey says 27% of the US investors invested in cryptos, while it was 22% last year. It's a 5% increase in just 1 year (Keep in mind the survey was realized before the COVID-19 crisis).

How they aren't investing in? The survey says otherwise, more than a third have already done so, and almost half among Europeans. While they ignored the market less than 3 years ago.

Not a lot of money? They expect to have at least 0.5% of their portfolio allocated in, while it may not seem like much to us, we're talking about hundreds of billion dollars. Usually, we dedicate a low percentage to the risky investments (due to diversity and risk balancing).
We often hear we shouldn't allocate more than 5% to risky investments (or something like that), 1% here, 1% there, etc...

If we consider Blackrock for example, they manage like 7,000 billion USD, if they invest just 1% it's 700 billion injected in the market.

[Harlot]

What is stopping them?
- market manipulation
- lack of knowledge
- volatility

Aren't this problems can easily solve by them? I mean they have the money to learn and manipulate the crypto market all they want just like what they have been known to be doing in the stock market for a long time now. These problems that you have stated are not really problems for them but if we think about what's really stopping them it's either them being a conservative or traditional investor or their clients are the ones against the idea on pooling their funds in the crypto market, we all have seen statements for conservative billionaires like Warren Buffet against Bitcoin and I think a lot of people in the financial industry is sharing the same sentiments as Warren Buffet.

[Gozie51]

What is stopping them?
- market manipulation
- lack of knowledge
- volatility

we all have seen statements for conservative billionaires like Warren Buffet against Bitcoin and I think a lot of people in the financial industry is sharing the same sentiments as Warren Buffet.

Those statements have not even worked against bitcoin and cryptocurrency as we all see. Is just like the Chinese having much hate to bitcoin in 2017 but we saw an ATH that year.
So those statements can only make people who have been looking for a reason not to invest to justify themselves. Soon a new ATH will show in bitcoin and altcoins.

[Lucius]

- 91% of them would like in the next 5 years cryptos represent at least 0.5% of their portfolio.

If this is an accurate figure, then this would really be a very significant indicator of what will happen in the next 5 years with the cryptocurrency market. When we talk about big players who have trillions of dollars, then even 0.5% represents a significant amount that must undoubtedly have a significant impact on the price of Bitcoin. It would be really interesting to witness when it all starts, because the amounts of BTC are limited and may not be enough for everyone.

What is stopping them?
- market manipulation
- lack of knowledge
- volatility

It seems to me that big investors are waiting for some green light in the form of global regulation of cryptocurrencies, because they probably still estimate that the risk of investing in such things is much higher than the possible profit. I do not mean only the volatility, but also the security of the entire crypto infrastructure.

[baby_ghost]

Institutional investors: endowment funds, commercial banks, mutual funds, hedge funds, pension funds, and insurance companies. institutional investor is an entity which pools money to purchase securities, real property, and other investment assets or originate loans.

[Febo]

I can see this growing more and more. Once Bakkt becomes more popular it will only increase the amount of institutional investors and fuel more innovation too.

BAKKT will get very popular as soon price of Bitcoin get to $20000.  I am sure that was main reason why was made. Those that learn more about Bitcoin acquired it other ways then bought on BAKKT. Once price reach $20000, there will be plenty of those having no ideas what Bitcoin is just wanted to have it.

[Twentyonepaylots]

- 91% of them would like in the next 5 years cryptos represent at least 0.5% of their portfolio.

If this is an accurate figure, then this would really be a very significant indicator of what will happen in the next 5 years with the cryptocurrency market. When we talk about big players who have trillions of dollars, then even 0.5% represents a significant amount that must undoubtedly have a significant impact on the price of Bitcoin. It would be really interesting to witness when it all starts, because the amounts of BTC are limited and may not be enough for everyone.

The growth is significant for the cryptocurrency in general, I hope this will continue year by year so we just sit and wait til that time comes. If we get enough boost, it would not take a long 5 years to make we could just make it in 2 to 3 years, after the pandemic I guess. The scarcity of the bitcoin will be the key for its success, early adopters don't need to compete in the market just the buy bitcoins.

What is stopping them?
- market manipulation
- lack of knowledge
- volatility

It seems to me that big investors are waiting for some green light in the form of global regulation of cryptocurrencies, because they probably still estimate that the risk of investing in such things is much higher than the possible profit. I do not mean only the volatility, but also the security of the entire crypto infrastructure.

Indeed. There are some hindrances especially in terms of legality of cryptocurrencies, just recently I've read that there are some upbringing of the banning of cryptocurrency in India. This might affect greatly the crypto scene, if this happens expect the crypto to slightly dive and remain on that range shortly.

[Rafael_Carrero]

Between the third quarter of 2019 and the first quarter of 2020, the amount invested in more than doubled — from $388.9 million to $818.5 million. If "smart money" on Wall Street is finally starting to pour money into crypto, this tendency should continue. Investors are loosing confidence in fiat money.