Large institutions are now with increasing frequency stepping into the cryptocurrency market. Just today MassMutual has bought 100 million dollars worth of Bitcoin. This is one of several examples of traditional institutional buying of Bitcoins. We’re seeing an evolution of Bitcoin going from a fringe community to being widely adopted by mainstream organizationans. These numbers are nothing to scoff at.
Another example of institutional buying the past week is that of MicroStrategy Inc. They are a tech giant not a financial one but the point still stands. MicroStrategy’s play is raising $650 in debt instruments to pay for their acquisition.
These are just two examples of institutional interest in cryptocurrency assets and the technology that powers it. This institutional buying is an overall bullish indicator for the space. Institutional moves are regarded as “smart money” while smaller retail players are often disregarded and dismissed.
Two Benefits of Continued Institutional Interest
The inflow of institutional capital and interest serves to bolster the crypto coin economy in two ways. First the actual price pegged to traditional fiat currencies should be supported giving the value a stable floor. The second is the creation of services that allow for the exchange, facilitation, and use of the crypto coins. Big and small players alike are creating an ecosystem that sustains the use of Bitcoin and other altcoins. Products and services are such as exchanges, wallets, and yield generating platforms, allow an economy to thrive around crypto.
As more smart money flows into the cryptocurrency space it’s getting increasingly difficult for naysayers to dismiss the phenomenon as a passing fad with no future. It makes sense to trail the movements of big institutional money as they have limitless resources to drive movement of industries. Cryptocurrency is certainly no different. The irony is that Bitcoin was created as a way to bypass traditional financial outlets and now these powerhouses are scrambling to get in on the sector themselves.