The coronavirus pandemic was indeed a turning point – not just for the financial industry, but for the whole world. Many of them had plans and goals that they wanted to achieve before the year was up but had to stop. Companies had to file for bankruptcy and people lost their jobs.

Like every sector of the world economy, the financial sector has suffered greatly from the effects of the epidemic. Countries strive to keep their economies alive while people look for ways to stay in debt.

It goes without saying that stock markets and financial institutions around the world are uniquely exposed at this time. This is a danger the world has never seen before. Even the global financial crisis of 2008 failed to prepare us for the impact COVID-19 had on the global economy.

One aspect that has managed to weather the storm so far is the cryptocurrency market. While Bitcoin (BTC) fell to $ 3,800 in March, the higher cryptocurrency’s value rose and consolidated faster than any other investment tool in the world.

The stock market has only just started to rebound and alternative assets remain in constant volatility. However, cryptocurrencies were powerful.

Understanding the types of crypto investors
When it comes to cryptocurrency investors, there are two basic types:

Retail Investors: Ordinary people who want to buy cryptocurrencies for various reasons, particularly investments and payment instruments.
Institutional Investors: High net worth individuals and companies who want to speculate and invest in assets.
Many could argue how retail investors interacted with Bitcoin through the pandemic, using the data to back up their facts. However, measuring institutional demand is much easier.

Fortunately, institutional demand for Bitcoin and many other cryptocurrencies seems to be at optimal levels.

How do asset management companies work?
One of the best ways to understand this trend is to examine the number of asset management and institutional investment firms in existence. To date, many of them have made significant profits.

Pantera Capital

This month, asset management company Pantera Capital announced in a disclosure form to the US Securities and Exchange Commission that the Pantera Venture III fund has raised $ 164,705,834 to date. The fund, launched in 2018, has raised $ 68,841,379 from its accumulated audience over the past 12 months.

The average ticket size for Pantera investors at the time was also $ 1.77 million – more than four times as much as in 2019 and almost twice as much as in 2018. As the company stated, such a number was a surge in institutional investor interest – the main market.

Grayscale investment

No institutional investment firm has performed better in the crypto industry than Grayscale Investments in New York. Grayscale is currently the largest asset management company in the crypto industry. The company made big gains last year as Bitcoin finally emerged from its recession in 2018.

However, in 2020 the company had consistently better numbers. Last month, the company said in a tweet on Twitter that total assets under management rose to $ 5.1 billion – an increase of nearly $ 1 billion in less than two weeks.

The company said it had doubled its Bitcoin Cash (BCH) fund’s assets under management from $ 6 million to $ 12.8 million. Bitcoin trust saw the biggest gains at $ 782 million. The Ethereum (ETH), Ethereum Classic (ETC) and Litecoin (LTC) trust funds also added $ 174 million, $ 12.7 million and $ 6.7 million, respectively.

Overall, Grayscale has confirmed that it has assets under management of $ 5.2 billion, of which Bitcoin alone is $ 4.4 billion.

Thanks to the growth of Grayscale, an advertising campaign brought Bitcoin and cryptocurrency investments to a large audience. Whether this is true or not, the fact that the number has grown impressively means that institutional investors are seriously considering cryptocurrency investing.

Opportunities for everyone
All of this indicated that many were promoting Bitcoin as the most reliable hedge against the impending global recession.

Source: CoinTelegraph

LEAVE A REPLY