While publicly-listed firms are pursuing direct exposure to Bitcoin, one Wall Street executive believes the market still needs more institutional investment presence to attain greater stability.
Big Money Players Yet to Dominate Bitcoin Market
Speaking in a CNBC interview on Monday, Jeff Curie, head of commodities research at the investment bank Goldman Sachs, said that while bitcoin has witnessed an influx of institutional money, more funds are still needed to enable BTC maturity status.
Compared to previous years that saw companies wary of bitcoin, more institutions embraced the flagship crypto and pumped money into the asset 2020. Companies like Microstrategy and Ruffer Investment invested considerable amounts in bitcoin.
Part of the reason Bitcoin is seeing interest from institutional investors stems from the dovish monetary policies adopted by major central banks. Big money investors believe that incessant fiat printing to fund coronavirus stimulus packages could trigger significant monetary debasement, impacting their wealth.
Meanwhile, the influx of institutional money is believed to have caused the price of bitcoin to moon, setting a new all-time high (ATH) at $42,000. However, Monday saw the BTC price crash 28% but has made a slight recovery since its decline.
While it is impressive that there has been a growing interest in bitcoin among institutional investors, Curie believes that more funds need to come into BTC, adding:
“The key to creating some type of stability in the market is to see an increase in the participation of institutional investors and right now they’re small.”
BTC is a Maturing Asset Class
Nevertheless, the investment bank executive stated that the crypto market was beginning to mature.
Curie went on to add that the total amount of institutional money invested in BTC accounts for about 1%. Also commenting on Monday’s price crash, Curie stated that with a nascent industry like the cryptocurrency market comes volatility and risks.
Recently, a Swiss media platform noted that bitcoin was becoming socially acceptable among investors. This is partly due to the fact that investors are seeking better options to protect their funds against an economic crisis.
While the Goldman Sachs executive seems positive about the crypto industry, others do not share such sentiment. As reported by CryptoPotato, Jeffrey Gundlach, DoubleLine Capital’s CEO, stated that bitcoin was in a bubble.
Featured Image Courtesy of Goldman Sachs