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In Asia, Bitcoin and Ethereum fund products have been launched one after another, which will attract more traditional funds. On March 10, Bitcoin once again broke through $55,000 in the morning. The support of major institutions has contributed greatly to this. In the United States, Bitcoin is being introduced into mainstream asset allocation, mainly including institutions represented by Tesla. In Asia, it was Meitu that fired the first regional shot. On March 7, Meitu, a Hong Kong-listed company, announced that it had purchased $22.1 million in Ethereum and $17.9 million in Bitcoin in open market transactions on March 5, 2021, spending about 260 million yuan. This makes Meitu the first Chinese listed company to publicly announce a large purchase of Bitcoin and Ethereum. Cai Wensheng, the head of Meitu, later said in his WeChat Moments: "This purchase of cryptocurrency is a value reserve for the long-term development of the blockchain strategy. Someone has to be the first to try it." The industry generally believes that, influenced by Meitu, the number of Hong Kong-listed companies purchasing cryptocurrencies will increase. This has set a precedent for domestic institutions to enter the cryptocurrency market, and has also included Ethereum in the strategic reserves of large institutions. From a regional perspective, behind the active participation of these institutions is a shift and change in BTC chips. The purchase of cryptocurrencies by listed companies has spread rapidly from Wall Street. From North America to Asia, a route for the transfer of BTC assets between institutions has become clear. "There is more than one beautiful picture" In response to Meitu’s latest move, Zhao Changpeng, founder of Binance Exchange, tweeted: "Many Asian companies already own Bitcoin, they just don’t make it public." Indeed, Meitu has been labeled as the "Hong Kong version of Tesla". Some time ago, many listed companies in the United States, the United Kingdom, Germany and other countries and regions chose cryptocurrencies in their asset allocation. According to data collected by KevinRooke, a relatively authoritative BTC holding ranking website, among the BTC holding institutions, there are 21 listed companies and 6 unlisted companies, accounting for 0.824% and 1.008% of the total Bitcoin supply respectively. Among them, Meitu's BTC holdings ranked 12th. The top-ranked listed companies mainly include the well-known MicroStrategy, Tesla, Galaxy Digital Square, etc., as well as a large number of Bitcoin mining institutions in North America. On this website, data updates are mostly concentrated in the second half of 2020, and the data sources are mostly public information from the market and various companies. (Data source: BTC holdings ranking website KevinRooke) The mainstream view is that the market trend brought by institutions has gradually exploded since August last year. MicroStrategy, a business intelligence software company listed on the Nasdaq, announced its entry into the Bitcoin market, becoming an important indicator in the market. The SEC (U.S. Securities and Exchange Commission) and the audit department approved MicroStrategy to include Bitcoin in its balance sheet. This means that under the supervision of the SEC, Microstrategy can learn from the way it buys Bitcoin as a balance sheet and complies with the accounting and legal standards disclosed by listed companies. Driven by listed companies such as Tesla and MicroStrategy, more and more listed companies in North America began to follow suit. Some traditional listed companies began to turn to Bitcoin at the business level and asset reserve level. Soon, payment company Square also began to follow suit, investing 1% of the company's total assets in Bitcoin. In late October of the same year, PayPal also announced its official entry into the Bitcoin industry, allowing users to directly purchase cryptocurrencies such as Bitcoin. The number of US listed companies interested in Bitcoin continued to increase in February this year. According to recent SEC documents, Immersion Technologies (code: IMMR), a US listed company, said it may choose to purchase Bitcoin and other encrypted assets in the future; Urban Tea, the parent company of Chinese tea brand Ming Yun Tang listed on Nasdaq, also announced that it will launch key strategic expansion in blockchain and encrypted asset mining. On the other hand, mining companies in the United States and North America are also rushing into the market. North American mining companies, represented by the Marathon Patent Group, which ranks fourth, are constantly buying mining machines. In addition, the founder of Grayscale's parent company DCG recently announced that it would build the largest Bitcoin mining pool in the United States. It can be seen that the North American mining infrastructure represented by the United States is getting stronger, and the overseas market is also gradually expanding its computing power share. BitDeer CEO Meng Xiaoni recently told the media that according to their calculations, it is expected that by the end of 2021, the overseas computing power space may increase to 40%, and China's computing power will drop to about 60%. Many actions show that Bitcoin is no longer limited to a small range of capital participation. Institutional entry, asset risk aversion, hedging arbitrage, and the macro environment of monetary easing. In Wall Street and North America, cryptocurrencies and traditional financial markets were first linked. It can be seen that in this round of big market, large institutional investors played a very important role and were also an important factor in Bitcoin's historical breakthrough. To some extent, institutional investors and high-net-worth individuals led this market, and they tend to be more inclined to hold Bitcoin for a long time. Chainalysis' chief economist once believed that the market was driven by North American institutional investors. Data shows that North American exchanges have received net inflows of Bitcoin from other parts of the world, and the number of transfers worth $1 million or more sent by exchanges this year has increased by 19%. Over the past year or so, the amount of Bitcoin held in Asia has fallen by more than 400,000 coins, while the amount held in North America (represented by the United States) has increased by more than 600,000 coins. (Image source: BeatleNews) Recently, overseas countries are still exploring ways to expand the digital asset compliance market. In mid-February this year, the first Bitcoin ETF in North America was approved for listing. Purpose Investments' first Bitcoin exchange-traded fund (BTCC) in North America was approved by Canadian financial regulators and began trading on the Toronto Stock Exchange on February 18. The fund is sold in Canadian dollars and US dollars. The first-day trading volume reached 200 million Canadian dollars (about 155 million US dollars), breaking the Canadian record. According to Reuters' report on the crypto market trends in 2020, last year, a surge in interest from North American institutions drove a shift in Bitcoin trading and became the largest participant in last year's gains. At the same time, the number of Asian investors, who were the main force driving the rise in Bitcoin prices in 2017, is decreasing. North American investors were the largest participants in last year's gains. After a large number of institutions entered the market, American investors have gradually stopped worrying about compliance. A large part of the community believes that BTC fundamentals are positive and BTC pricing power is shifting to Wall Street. Asian institutional channels are opening up Is it time for Asian institutions to enter the market? As the price of Bitcoin continues to break through, capital forces are still attracting more listed companies and institutions to join the Bitcoin market. Faced with the increasing enthusiasm of overseas institutions for Bitcoin, Asian institutions have also begun to take action. On March 4, Huobi Technology Holdings Co., Ltd. announced that its wholly-owned asset management subsidiary Huobi Asset Management has been approved by the Hong Kong Securities and Futures Commission to issue funds with 100% virtual assets. Huobi Asset Management will issue three virtual asset funds: Bitcoin Tracking Fund, Ethereum Tracking Fund and Multi-Strategy Virtual Fund. Huobi co-founder Du Jun publicly stated: In the United States, institutions represented by Tesla are gradually introducing Bitcoin into mainstream asset allocation. Coinbase, a licensed digital currency exchange in the United States, has officially submitted its prospectus, taking the last step before listing. Nasdaq is also attracting blockchain companies to join. These will affect the Asian region and also affect the development trend of the blockchain industry. This shows that blockchain and digital asset investment are gradually entering the mainstream field. From the industry's perspective, this is a typical Asian "interface" between traditional capital markets and digital assets. Some believe that the CSRC's approval of Huobi's launch of a virtual currency fund may have been inspired by the world's first Bitcoin ETF (BTCC). From Grayscale in the United States to Purpose and Evolve in Canada, and then to Huobi in Asia, Bitcoin is crossing the market and transforming into a mainstream investment target, which has also made Asian institutional investors re-examine this type of asset. On March 9, Malaysia’s BCMG Genesis also announced the launch of a Bitcoin Fund (BGBF-I). Officials said that this was launched in response to the growing demand for institutional crypto products in Southeast Asia, and IBH Investment Bank served as the main advisor to the fund. After the "Grayscale Effect" spread to Wall Street, the actions of Asian institutions have also become an important direction for the market to observe. The launch of Bitcoin and Ethereum fund products will attract more traditional funds, thereby boosting the prices of mainstream projects. In a public comment, OKLink chief researcher Li Lianxuan believed that Meitu's purchase of cryptocurrencies was a follow-up effect of Tesla's previous investment in cryptocurrencies. Meitu also left new expectations in the market in public information: according to a cryptocurrency investment plan previously approved by the company's board of directors, Meitu can purchase cryptocurrencies with a net value of no more than US$100 million, with funds coming from the company's existing cash reserves. From this point of view, Meitu's investment in virtual currencies may still "increase its position". From investment giants to listed companies, and from North America to Asia, this institutional buying craze for Bitcoin has already seen a new trend. How Asian institutions will react remains to be seen. |
