Bitcoin

Hedge funds, private investors bought in the fall in prices

According to Jesse Powell, CEO of Cryptocurrency Exchange Kraken, there was a massive influx of new accounts from investors of all types. This trend coincides with the strong recovery in Bitcoin (BTC) from $ 3,600 to over $ 9,000.

Powell’s statement agrees with similar observations made by Coinbase earlier this year. When the exchange also saw a surge in demand, the price of Bitcoin fell to $ 3,596 on March 12.

Coinbase saw high demand in March

Hedge funds, private investors bought in the fall in prices
Hedge funds, private investors bought in the fall in prices

Coinbase saw high demand in March. Source: Coinbase blog

The data shows that demand from private and institutional investors has been growing steadily since mid-March and the mood among Bitcoin investors has improved.

What does the influx of new investors mean?

In conversation with Bloomberg, Powell said::

“We have seen a massive influx of new hedge fund accounts, asset managers, retail investors and daily traders. We have seen people do their stimulus checks and turn them into Bitcoin. “

In the same way, The US stock market saw a significant increase in retail trading activity on platforms like Robinhood and Charles Schwab.

Since the beginning of the 2020s, the influx of capital from institutional investors in Bitcoin has increased rapidly, especially due to Grayscale’s Bitcoin Trust value. Due to the institutions’ increased appetite for BTC, Powell emphasized that investors are looking for a safe asset given the uncertainty in the global financial market.

The BTC-USD pair volume remains high in octopuses

The volume of the BTC-USD pair remains high in octopuses. Source: Cryptowat.ch

Paul Tudor Jones, the billionaire hedge fund manager and founder of Tudor Investment Corporation, He said he invested in Bitcoin to hedge inflation. Since then, Bitcoin’s perception of value storage and potential long-term safe haven has improved. Powell added:

“Everyone goes in (Bitcoin). I think we all know that a lot of people have a lot of free time at home these days. People take their stimulus checks and bring them to Bitcoin or the stock market. I think there was a massive new number of entries. People are very concerned about traditional markets and what is happening to the US dollar and what they are looking for is a safe haven. “

Can demand lead to higher prices?

Market trends on US stock exchanges and investment firms generally suggest that investors are accumulating Bitcoin on a consistent basis, especially after halving the block reward on May 11.

A confluence of fundamental factors For example, Bitcoin’s tendency to see sustained recovery and demand from institutes after halving, and growth in business on major Bitcoin exchanges increase the likelihood of a multi-year upward trend seen in previous price cycles.

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