Institutional Investors Account for 56% of Crypto Capital
Grayscale Investments LLC, an investment company which specializes in cryptocurrency funds, released its first ever cryptocurrency investment report, which showed that of the $250 million that it raised via new asset investments in 2018, 56% came from institutional investors.
Grayscale has been specializing in cryptocurrency investments since 2013, when it launched a Bitcoin Investment Trust in September of that year. The company later expanded its investments to include single-asset funds such as Ethereum Classic (ETC), Litecoin (LTC) and Zcash (ZEC). It also began providing diversified offerings such as its Digital Large Cap Fund.
Investments Increasing, Not Decreasing
This report was released just as Bloomberg interviewed Blackrock’s CEO Larry Fink, where he stated that institutional investors were not interested in investing in cryptocurrencies. Blackrock is one of the biggest asset managers in the world.
The CEO of Grayscale, Barry Silbert set the record straight on that claim, when he tweeting the findings of his company’s report on cryptocurrency investments.
The digital asset management company’s report revealed that despite the decidedly bearish sentiment in the cryptocurrency market, investments in cryptos had increased rather than decreased. In fact, Grayscale reported that the rate of investments had speeded up to levels that they had not been seen before.
The total investments made till June 30 of 2018 was nearly $248.4 million, which is the strongest-ever fundraising period for the company since 2013. In fact, according to the report, $9.55 million of fresh capital on average has been coming in on a weekly basis. Of this amount, 63% or $6.04 million has been going in to the company’s Bitcoin Investment Trust.
Other Report Details
Besides the institutional investors who make up a majority of Grayscale Investments’ portfolio, the report also showed the breakup of other investors’ profiles. Accredited individuals accounted for 20%, retirement accounts accounted for 16% and family offices accounted for 8% of all investments.
Additionally, about 64% of all investments were made from within the US, 26% from “offshore” investors and the last 10% from domiciled accounts. Institutional investors put in an average of $848,000, followed by family offices that put in $553,000. Retirement accounts invested $335,000 and accredited individuals invested $289,000. The report did offer a caveat, stating that these figures were skewed due to several large one-time investments and sums that had been broken up into multiple amounts being invested over a number of days.
Now is the Time to Invest
Grayscale Investments’ report indicated that investors are looking at the downturn in the cryptocurrency markets as the perfect time to invest. These investors are looking to buy the dip just when the infrastructure to help institutional investors enter the market is strengthening.