Will Bitcoin need Institutional Funding in its Current Scenario?

  • Bitcoin seems to become matured as an asset with high volatility
  • To reach new highs the token needs to reduce its volatility
  • To reduce the volatility more institutional funds are needed to be poured in Bitcoin
  • The token has gained traction of most of the bulls as a store of value

In recent months, every eye in the cryptosphere has witnessed the fabulous performance of Bitcoin. Despite performing immensely the world’s most famous crypto token remained highly volatile by nature. According to Jeff Currie, Goldman Sachs’ global head of commodities research, the leading crypto token shows signs of maturity as an asset, despite its high volatility. He also mentioned that the inflow of funds from the institutional investments is still minor compared to the gains accrued in the recent price rally.

Bitcoin needs more institutional funds to stabilize

Currie believes that Bitcoin requires more inflows from the global financial sector to stabilize its volatility. After the entire crypto market, including Bitcoin and other altcoins faced a significant sell-off on Monday, Currie made its statement. He stated that it seems like the market is getting more matured, and in every nascent market, such levels of volatility and associated risks are observed. Additionally, he also highlighted that the key stabilization of the market is the financial institutions’ participation, which is too small in the current scenario. However, though institutional investors were the driving force of the flagship cryptocurrency price, there is just a rough amount of 1% of institutional funds poured in the market.

BTC gained the attraction of institutions as a store of value

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Observing the current scenario, it is found that most of the investors are starting to relate the leading crypto token as a store of value similar to traditional gold. Every economy on this planet has suffered due to COVID-19 pandemic, and several governments took drastic measures to cushion the economies. The situation also devalued several fiat currencies that created concerns among the investors, which helped them find Bitcoin as an alternative investment. Several millionaire investors started to bet on the cryptocurrency, and institutions also started to allocate a portion of their funds to gain the advantage of the spike in prices.

Volatility needs to be reduced to hit new highs

Several millionaire investors and financial firms started to dive in the cryptosphere, and large investment banks also turned to observe the space. JPMorgan gave Bitcoin a lot more attention in recent days. Several strategists at the bank have revealed their prediction and mentioned that the price of the flagship crypto token would surge more and achieve the level of $1,46,000. However, they also warned the Bitcoiners that to achieve such a level the crypto token will need to reduce its volatility, which makes it challenging to forecast the price.

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Ahtesham Anishttp://www.thecoinrepublic.com
Ahtesham Anis is a Computer Science undergrad student currently based out of India. Coming from the business background and his keen interest in Cryptocurrency and Blockchain technology is what Ahtesham brings to the table. He is always an eager learner when it comes to exploring the new technologies and topics in the crypto world.

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