Cryptocurrency investment expert: Institutional investors will push Bitcoin prices to extremely high levels

As Bitcoin’s price breaks new highs, will its bull run soon end? Read on to find out why investment experts like Zerocap’s Trent Barnes believe Bitcoin has more room to grow.

Zerocap, a Melbourne-based digital asset investment and custody service, published a report titled “Bitcoin: A Hedge Investment” at the end of the third quarter of this year, when the price of Bitcoin had recovered to over $10,000 since the March crash. Zerocap suggested:

You haven’t missed your chance to get on board yet. Now is the time to ride the wave of change and invest in Bitcoin.

Now, not only has the price of Bitcoin rebounded from last week's slight drop, but it has also hit a record high of $19,749. Since its birth in 2009, Bitcoin has not only approached $20,000 again, but its market value has surpassed JPMorgan Chase, the world's largest traditional bank and a pillar of Wall Street.

Trent Barnes, head of Zerocap, told Forkast in a recent video interview:

We know that as long as the market and market participants continue to be optimistic about Bitcoin, its price will continue to rise. We have not only received recognition from retail investors, but also from institutional investors.

Since the outbreak of the new coronavirus hit the global economy hard at the beginning of this year, the price of Bitcoin has fallen to a low point. After experiencing the "halving" time in May this year, which marks a decrease in the rate of new mining of Bitcoin in the future, the price of Bitcoin has continued to improve and has continued to rise with the huge growth of decentralized finance (DeFi) this year.

Last month, Bitcoin’s market value surpassed that of JPMorgan Chase & Co., and this week its price hit its highest level since the initial coin offering (ICO) boom in 2017.

In 2017, the price of Bitcoin reached a high and then plummeted, and the market became a graveyard for startups that were either overly speculative or scams. But that is in the past, and the 2020 Bitcoin bull run is driven by completely different forces. Now, more and more institutional investors and large companies are starting to buy Bitcoin to hedge their portfolios against inflation risks.

Barnes said:

I think the Fed has printed three times as much money this year as it did during the global financial crisis in 2008. So this has really increased the curiosity of a lot of our clients about Bitcoin.

As 2020 draws to a close, institutional investors preparing to buy Bitcoin also include global investment firm Guggenheim Partners. The company disclosed in a recent filing with the U.S. Securities and Exchange Commission (SEC) that it plans to invest up to 10% of the Macro Opportunities Fund (about $500 million) in Bitcoin. Software company Microstrategy also recently revealed that it has also invested more than $400 million in Bitcoin. Other well-known companies that have joined the Bitcoin investment army include PayPal, Twitter CEO Jack Dorsey's Square, and hedge fund manager Paul Tudor Jones.

Barnes said:

You're going to see a lot of different companies converting their cash reserves or cash balances into Bitcoin because I think it's a safer hedge.

Barnes did not speculate on the future price trend of Bitcoin. But he believes that the strong interest in Bitcoin from institutional investors and financial advisors of high-net-worth families will continue into 2021. He said:

We know that as long as the market and market participants continue to view it this way, it will rise.

Here are highlights from Barne’s interview:

How this year's Bitcoin bull run is different from 2017: "What we're seeing is that Bitcoin has become a proven asset, especially due to institutional money inflows and institutional protection. So we're definitely seeing a much greater curiosity in Bitcoin among investors and the consumer base, more so than we saw during the ICO boom in 2017, I'm pretty sure."

Bitcoin as an inflation hedge: “When we talk about Bitcoin as an inflation hedge or a safe haven asset, we see that in times of tight liquidity, all markets and all assets go down because there is unprecedented uncertainty in the market, especially if investors are looking to make margin calls.”

When is the right time to invest in Bitcoin: "It's always been the right time to invest in Bitcoin. If you ask any of the early adopters, they see the programmed money supply schedule, and the last Bitcoin will be mined in 2140. So the issuance of Bitcoin is predictable. It has no boundaries, it has no permission. I think Obama calls it "walking around with a Swiss bank account." "It's more like a Swiss bank, where you are the CEO, the teller, and the manager, all in one."

How DeFi drives you to invest in Ethereum: "What we noticed is that it's almost like in a bubble, the market enters the DeFI boom phase, and the Yield Farming craze begins to emerge, and you need to invest a lot of time and energy. So that's why we include Ethereum as one of our investment assets. You can indeed buy various DeFi tokens, but if you can really see through the essence, you should understand what these projects are built on? Ethereum as a protocol, the vast majority of DeF projects are actually built on it."

What percentage of people's investment is in Bitcoin? "Some investors like to set the percentage of their investment in Bitcoin very high. I have several friends whose portfolios are 50% in Bitcoin, which is indeed high. But many investors tend to invest 1% to 5% of their assets in Bitcoin. This is because of its asymmetric risk. This means that a very small investment may bring a very small loss, or a very high return, especially when you look at the historical price curve of Bitcoin."

Original article: https://forkast.news/institutional-investors-blast-bitcoin-prices-to-new-stratosphere/
By Mathew Di Salvo
Compiled by Captain Hiro