HomeBusinessFintech and BlockchainWhat's behind bitcoin's new rise?

What’s behind bitcoin’s new rise?

Published on

Why alternative investing in bitcoin is making more and more sense even for institutional investors?

The price of bitcoin is moving back to historic highs, above $ 19,000 and the mobility around the “king” of cryptocurrencies is increasing in view of the end of the year.

The high volatility of bitcoin is one of the reasons that traditional institutional investors generally do not include it in their shopping cart.

However, the peculiar environment that prevails in recent years due to the uninterrupted creation of new money and negative interest rates leads some institutional investors to look for alternative placements, such as increasingly “risky” stocks and bonds, gold, while some of them choose the bitcoin.

Of course, bitcoin placements are very small compared to their portfolios, but they are relatively significant amounts for the data of the -small- bitcoin capitalization.

Insurance giant MassMutual in the US, for example, with hundreds of billions in cash, announced that it has invested $ 100 million in bitcoin.

Financial analyst and investment manager Michalis Nicoletos, who monitors developments in bitcoin, wrote in a Twitter message that bonds worth a total of $ 18 trillion now have negative returns. Whoever buys them, if they keep them until the expiration has a 100% chance of losing money. And as the number of bonds with negative returns increases, it makes more and more sense to invest in gold and bitcoin.

Other factors that drive the price of bitcoin higher are:

  • The so-called “cold storage”. Many bitcoin investors “take out” the money from the market and the accounts they keep in exchanges, choosing secure storage (in essence they store the code on a USB or other secure medium). So the bitcoin supply is reduced.
  • Greyscale, a mega-investor in bitcoin, buys almost all of the new bitcoins that result from “mining”, which increases demand and reduces supply.

Latest articles

Neuroscience Breakthrough: Study Pinpoints Brain Activity That Helps Prevent Us From Getting Lost

No more wrong turns: Explore the findings of a groundbreaking study revealing the brain's...

Brief Anger Hampers Blood Vessel Function Leading to Increased Risk of Heart Disease and Stroke – New Study

New research in the Journal of the American Heart Association unveils how fleeting bouts...

New Blood Test Pinpoints Future Stroke Risk – Study Identifies Inflammatory Molecules as Key Biomarker

Breakthrough Discovery: A Simple Blood Test Can Gauge Susceptibility to Stroke and Cognitive Decline...

Enceladus: A Potential Haven for Extraterrestrial Life in its Hidden Ocean Depths

Enceladus: Insights into Moon's Geophysical Activity Shed Light on Potential Habitability In the vast expanse...

More like this

Neuroscience Breakthrough: Study Pinpoints Brain Activity That Helps Prevent Us From Getting Lost

No more wrong turns: Explore the findings of a groundbreaking study revealing the brain's...

Brief Anger Hampers Blood Vessel Function Leading to Increased Risk of Heart Disease and Stroke – New Study

New research in the Journal of the American Heart Association unveils how fleeting bouts...

New Blood Test Pinpoints Future Stroke Risk – Study Identifies Inflammatory Molecules as Key Biomarker

Breakthrough Discovery: A Simple Blood Test Can Gauge Susceptibility to Stroke and Cognitive Decline...