In the fourth quarter, an average of $ 250.7 million per week poured into Grayscale’s crypto investment products.
Institutional investors invested heavily in the crypto market in the fourth quarter of 2020, which can be seen from the fact that the crypto investment products from asset management Grayscale enjoyed great popularity during this period.
Led by investment products for Bitcoin ( BTC ) and Ethereum ( ETH ), the aggregate of all Grayscale crypto financial products reached $ 3.3 billion in the fourth quarter. This equates to an inflow of $ 250.7 million per week. Compared to the third quarter of 2020, the total value has more than tripled, as before it was just $ 1.05 billion.
While the Grayscale Bitcoin Trust grossed $ 217.1 million per week in Q4, the Ethereum mutual fund generated $ 26.3 million per week
93% of all new investments came from institutional investors, of which other asset management companies make up the majority. An increase of 9% compared to the third quarter, in which the institutions had already provided for 84% of the newly flowing capital.
Throughout 2020, a total of $ 5.7 billion was invested in Grayscale’s crypto investment products. A massive increase compared to previous years, because this value is more than four times the cumulative investments from 2013 to 2019.
„2020 saw some of the world’s most influential investors publicly support digital currencies as an asset class and some of the largest institutional investors and corporations allocating to Bitcoin,“ Grayscale told Cointelegraph, adding:
„The general economic situation and the current monetary policy are increasingly legitimizing Bitcoin as digital gold.“
Grayscale’s record numbers mark a turning point for Bitcoin, as they show that “smart money” finally recognized the cryptocurrency in 2020 as a hedge against inflation and a store of value. That narrative was one of the driving forces that pushed Bitcoin almost to $ 42,000 in January.
The increased acceptance by institutions paves the way for Bitcoin to become suitable for the masses, as Jeff Currie of Goldman Sachs confirms . However, the financial expert still sees a long way to go for the cryptocurrency.
With Joe Biden’s government taking office in the coming days, another corona aid package could soon be passed that Bitcoin may also play in the cards .