How Far is GrayScale & Other Institutions Going to FOMO Bitcoin? Poll!

[thecodebear]

I think when this happened in June they closed down investments for a few weeks, so I'd guess they will open it back up late January perhaps.

But yeah certainly impressive that in the week since Grayscale stopped investing the price went from $24k to $29.9k as of right now!

If there is going to be a correction in price soon I would expect it this month. Once Grayscale opens back up in a few weeks it's gonna be real hard to get anything other than quick bear traps when they are adding hundreds of millions of dollars of Bitcoin every single week!

I have always said the same thing, grayscale buying bitcoin does help increase the price a bit, but the real fact is that people are bullish on bitcoin and instead of the direct result of grayscale buying, the "news" of grayscale buying impacts the market a lot more if you ask me.

It is normal for financial companies to not make big moves on holiday break, from around 24th or so to few days into new years they usually do not make big moves, because its holiday time and they probably want to have fun too but at the end they will get back and considering we have increased even when they were gone, when they come back and make tens of even hundreds of millions of dollars worth moves, we are probably going to skyrocket even higher, I am expecting about 50k per bitcoin until this spring (or April latest) because they put a lot of money in, and we put a lot of money in because of what they do as well so its double dipping.

Yeah it's kinda of like a double pump phenomenon. They buy and lock up a TON of supply which makes the price go higher, and then every time news comes out about how much Grayscale bought, just that knowledge causes other investors to be like oh crap supply is getting eaten up I gotta buy in more before the price shoots up. Both of those things absolutely send the price upwards.

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[thecodebear]

I think yesterday, after the $30K wall was breached there was about $1,500,000,000. Yes thats the right amount of zeros. $1.5Billion worth of outflows from Coinbase. It looks like some kind of OTC custody buys which are sent to cold storage.

I am assuming this is not Grayscale however you never know. Seems like some huge fund decided to invest over a billion dollars worth. I am sure some time this week we will find out who it was when they decide to anounce it publicity on CNBC.

Either way, seems BTC is going through a supply side liquidity crisis, looking at order book depth, there is very little offers on the ask side.

Well Coinbase has an institutional service as well, I believe called Coinbase Prime. Microstrategy bought their 70k BTC through Coinbase Prime. I don't know how Grayscale does their buys but they aren't even buying right now so it definitely wasn't them. It must've just been some big institutional client(s) of Coinbase's. Goes to show that as much as Grayscale is publicly showing the institutional demand for Bitcoin each week with their investment reports, there's a lot more institutional demand coming in besides just Grayscale. And the institutional flood is still only just starting, right now it's only the most forward thinking 1% of institutions starting to nibble on Bitcoin.

[darewaller]

These are companies that do not have any rush like we do, when regular people end up buying bitcoin they usually just do that to get rich quick and they invest that into alts, defis and many other things or they just hope that bitcoin makes them super rich and when it doesn't they end up selling it.

So, what I think will happen is that these type of companies will get more and more bitcoins because regular people keep on selling bitcoin, they trade it at best (meaning they do sell but buy back and keep on doing this over and over again) which means there will always be more bitcoins on the market to buy for these big companies. This is exactly why I think it is quite obvious that these companies will take us to moon, since they only buy and never sell that means they are going to keep making bitcoin more and more valuable over time without a doubt.

[KTChampions]

I have always said the same thing, grayscale buying bitcoin does help increase the price a bit, but the real fact is that people are bullish on bitcoin and instead of the direct result of grayscale buying, the "news" of grayscale buying impacts the market a lot more if you ask me.

It is normal for financial companies to not make big moves on holiday break, from around 24th or so to few days into new years they usually do not make big moves, because its holiday time and they probably want to have fun too but at the end they will get back and considering we have increased even when they were gone, when they come back and make tens of even hundreds of millions of dollars worth moves, we are probably going to skyrocket even higher, I am expecting about 50k per bitcoin until this spring (or April latest) because they put a lot of money in, and we put a lot of money in because of what they do as well so its double dipping.

I agree about the big companies - most likely they are resting now and they are not on the market. What confuses me in the current growth cycle is the number of transactions - it used to grow at each stage of the excitement and it was very expensive to conduct any transaction, now nothing of the kind is observed.

[sana54210]

Well Coinbase has an institutional service as well, I believe called Coinbase Prime. Microstrategy bought their 70k BTC through Coinbase Prime. I don't know how Grayscale does their buys but they aren't even buying right now so it definitely wasn't them. It must've just been some big institutional client(s) of Coinbase's. Goes to show that as much as Grayscale is publicly showing the institutional demand for Bitcoin each week with their investment reports, there's a lot more institutional demand coming in besides just Grayscale. And the institutional flood is still only just starting, right now it's only the most forward thinking 1% of institutions starting to nibble on Bitcoin.

I also think that Grayscale doesn't really have that much money to invest into bitcoin all at once, they have invested nearly that much money for the past 1 year, to do as much of it in just one day would be a suicidal decision by them.

Plus they are on a great trajectory to make so much money as of right now with the amount of bitcoin they have, they do not need to put anything at risk, they have doubled their billion dollars in 2020, isn't that sort of enough?

If they get involved at this place it is going to get harder and harder, and with a drop they could be in a huge whole if they bought here, but if they stay away, they could still profit even after a fall. It could be anyone but I think anyone who has spent 1.5 billion dollars on 30k or more right now must be thinking too much further ahead, and not anytime soon, since we can't really double that quickly anymore.

[thecodebear]

I have always said the same thing, grayscale buying bitcoin does help increase the price a bit, but the real fact is that people are bullish on bitcoin and instead of the direct result of grayscale buying, the "news" of grayscale buying impacts the market a lot more if you ask me.

It is normal for financial companies to not make big moves on holiday break, from around 24th or so to few days into new years they usually do not make big moves, because its holiday time and they probably want to have fun too but at the end they will get back and considering we have increased even when they were gone, when they come back and make tens of even hundreds of millions of dollars worth moves, we are probably going to skyrocket even higher, I am expecting about 50k per bitcoin until this spring (or April latest) because they put a lot of money in, and we put a lot of money in because of what they do as well so its double dipping.

I agree about the big companies - most likely they are resting now and they are not on the market. What confuses me in the current growth cycle is the number of transactions - it used to grow at each stage of the excitement and it was very expensive to conduct any transaction, now nothing of the kind is observed.

That's another statistic of how we know this rally so far is fueled by institutions and not a massive retail investor frenzy - no massive number of transactions trying to get into blocks and tx fees staying in the high single digits (still high but not a massive frenzy high). It shouldn't confuse you, the price is going up because giant institutional entities are buying up massive amounts of BTC, which means for all this bought up Bitcoin there are only a few tx's needed to move them around, which is very different than millions of small investors picking up bitcoin all at once and trying to move it around. We'll know when the next retail investor craze starts when tx fees start skyrocketing and remain up there. For now it's just institutions eating up all the supply before the next retail frenzy has even begun.

[thecodebear]

Well Coinbase has an institutional service as well, I believe called Coinbase Prime. Microstrategy bought their 70k BTC through Coinbase Prime. I don't know how Grayscale does their buys but they aren't even buying right now so it definitely wasn't them. It must've just been some big institutional client(s) of Coinbase's. Goes to show that as much as Grayscale is publicly showing the institutional demand for Bitcoin each week with their investment reports, there's a lot more institutional demand coming in besides just Grayscale. And the institutional flood is still only just starting, right now it's only the most forward thinking 1% of institutions starting to nibble on Bitcoin.

I also think that Grayscale doesn't really have that much money to invest into bitcoin all at once, they have invested nearly that much money for the past 1 year, to do as much of it in just one day would be a suicidal decision by them.

Plus they are on a great trajectory to make so much money as of right now with the amount of bitcoin they have, they do not need to put anything at risk, they have doubled their billion dollars in 2020, isn't that sort of enough?

If they get involved at this place it is going to get harder and harder, and with a drop they could be in a huge whole if they bought here, but if they stay away, they could still profit even after a fall. It could be anyone but I think anyone who has spent 1.5 billion dollars on 30k or more right now must be thinking too much further ahead, and not anytime soon, since we can't really double that quickly anymore.

Grayscale doesn't work like that though. Investors give them money to buy Bitcoin, and in return Grayscale gives them shares worth that amount of Bitcoin. Grayscale just buys based on how much investors give them each day. The last three days of their 6 month investment period (dec 22,23,24) they bought up about 30k BTC combined, which is a massive amount (over $700 million) because no doubt investors were trying to get in just before Grayscale's 6 month investment period ended before they closed up for a few weeks - every 6 months they stop taking investments and close up for a few weeks, the 6 month period is a lockout period in which investors can't sell the shares they bought up during that time, but once the lockout period ends investors can sell the shares on the open market, and for whatever reason Grayscale shuts down investments for a few weeks at the end of each lockout period.

They aren't a managed fund that decides what investment moves to make on behalf of their investors and they aren't a corporation that is investing their cash into Bitcoin, they just buy BTC whenever their investors give them money to do so, which they then own and hold while giving shares pegged to the BTC price to their investors who can later sell them on the open market. And the way they make money is on the fees and premium they charge, meanwhile they own an enormous amount of Bitcoin to which their shares are pegged. Drops in price don't directly affect Grayscale at all, they just make money off the fees they charge their investors.

But yeah for sure these institutions that are buying up so much BTC, like that $1.5 billion that exited Coinbase the other day, are buying for the long term.

[fillippone]

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I also think that Grayscale doesn't really have that much money to invest into bitcoin all at once, they have invested nearly that much money for the past 1 year, to do as much of it in just one day would be a suicidal decision by them.
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 It could be anyone but I think anyone who has spent 1.5 billion dollars on 30k or more right now must be thinking too much further ahead, and not anytime soon, since we can't really double that quickly anymore.

Grayscale doesn't work like that though.
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Exactly, Grayscale is doing passive tracking investments on behalf of their clients. And do so for a hefty 2% fee.
@sana54210, if you want to know every detail on the mechanism of Grayscale, I might suggest you read this thread of mine.

Everything you wanted to know about Grayscale BTC Trust but were afraid to ask!

Please, feel free to ask any question in case you still have any concern.