- Institutional investors are yet actively depositing large funds in Bitcoin
- More than 12,000 BTC has been deposited twice this week from Coinbase Pro
- It seems like Coinbase creates new wallets every time for its customer after the OTC trade
- The increasing institutional demand in cryptos have affected the supply of such currencies
Recently it is observed that several firms and institutional investors are still purchasing Bitcoin (BTC). Coinbase Pro, the largest crypto exchange platform of the United States, has confirmed more than 12,000 BTC twice this week. This month after hitting a record high, Bitcoin has again achieved a new record high after crossing the price level of $26,000. However, observing the current price movement of Bitcoin, it seems like those investments have only somewhat contributed to the rally.
Coinbase seems to create cold wallets for each customer
Ki-Young Ju, the chief executive officer of CryptoQuant, a blockchain analytics firm, revealed via a tweet, that the institutional investments in Bitcoin are yet active. Ju revealed the case study of large investors while he reported the second deposit. According to Ju, the event was seen as a positive factor in the crypto market. On the other hand, Ju also noted that from one recent investment’s 12,006 BTC has been transferred to a wallet that looked like custody. However, pointing to the issue, he also mentioned that Coinbase might create a new cold wallet for each customer after the Over-The-Counter deal.
Increasing institutional demand for BTC have impacts on supply
It is observed that the current soaring demand for Bitcoin as an inflation hedge, has pointed out the impact on its supply volume. According to Rafael Schultze-Kraft the chief technology officer of Glassnode, a blockchain data analytics firm, this week, Grayscale Bitcoin Investment Trust (GBTC) a major crypto fund of the United States, has significantly exceeded the number of new mining over the last six months.
It is known that Grayscale’s total assets under management have reached more than $16 billion. Among the total assets under management, it is found that the Bitcoin fund has the largest amount of assets under management. However, over the last seven days, more 28,410 BTC has been deposited in the fund.
Bitcoin’s addition of institutions portfolio
One of the main reasons behind Bitcoin’s surge of this year is the asset’s addition in the company’s portfolio. As institutions like MicroStrategy and MassMutual are making large purchases, and due to the pandemic, the central banks have continued to supply cash in bulk, the demand for BTC has boomed. However, mainly such institutions are using Bitcoin’s as a means of hedging inflation.
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