How the Rising of Bitcoin got Institutional Investors in the Crypto Area?

Bitcoin is the digital coin that started the decentralization movement, bringing with it outstanding blockchain technology. People were excited that they could rely on financial services without banks and having to expose their personal data, therefore being protected against bad actors and censorship at a higher level.

And after 12 years of existence, Bitcoin finally gets its well-deserved recognition.

The price evolution of Bitcoin

Bitcoin is known as the first cryptocurrency in the world, released in 2009 by Satoshi Nakamoto, with a value of just $0.0008. At first, it wasn’t taken seriously, the technology being seen as some kind of science-fiction.

But there were still curious people that had the twinkle to join the game in order to find out what this is all about. And thanks to the pizzas bought with 10,000 BTC by Laszlo Hanyecz in 2010, people started to see the usability of it.

With that event, the value of Bitcoin started to rise substantially, in 2010 getting a giant 9900% growth from the initial value in just a year. And note that this meant just $0.08 at that time.

Seeing the opportunity, many other people started to mine Bitcoin, releasing new coins from the 21 million available in the total supply. Digital scarcity within an encrypted decentralized network is a new technological invention and scientific breakthrough. Eventually, they’ve got them into the forex market with other fiat currencies and so they got Bitcoin to the value of $1,154.

At this time, governments were already panicking, seeing Bitcoin as a real threat to the centralized financial banking system, and started to either make defamatory public speeches or ban crypto transactions all along (like Bolivia or India).

Private companies, however, saw an opportunity and started to accept Bitcoin as a payment for various things. The best example is Microsoft, which made possible the acquisitions of Xbox games with this cryptocurrency.

The biggest growth rates have been recorded at the end of 2017 and 2020, along with the recent one in January 2021. And to have a clearer image, look at the numbers:

• From $5,900 to $19,166 in just 34 days (Nov 14^th 2017 – Dec 17^th 2017);
• From $18,359 to $26,975 in 20 days (Dec 11^th 2020 – Dec 31^th 2020);
• From $29,333 to $40,520 in 9 days (1st to 9^th Jan 2021).

With those values, no wonder why there is so much fuss right now over bitcoin and crypto in general. And this is thanks especially to the vendors that started to accept crypto like any other fiat currency, increasing their usability. Governments changed their attitude too, some of them making great efforts into encouraging this new type of payment – like the European “Mediterranean” 7 group.

What Institutional investors joined the hype?

The real businessmen acknowledge the opportunities when they appear and take advantage of them once they’re done with the forecast.

So it was that many great names in the business world joined the Bitcoin community, some of the reasons being:

• the potential of Bitcoin as a new digital safe having asset (gold) within a decentralized encrypted monetary network;
• the potential of Bitcoin to even overcome the power of the dollar;
• the simplification of the institutional transactions – it is actually simpler to count the investments in small numbers with big value.

One of them is Paul Tudor Jones of the Tudor Investment Corporation, who affirms that Bitcoin is a revolution at least equal to The 1999 Internet.

Rick Rieder and Larry Fink of BlackRock also joined the hype, with the idea that Bitcoin could very well replace gold.

George Ball, Bill Miller, Ray Dalio, the names continue to come. And the Guggenheim partners step up the game investing no less than $500 million in Bitcoin. Based on their forecast, this could grow Bitcoin up to $400,000.

Now we don’t talk just about buying cakes with cryptos from our favorite restaurants. This entire domain expanded substantially up to institutions, so the aim of Bitcoin developers is finally becoming true.

What about the risks of Bitcoin’s volatility?

In spite of the increasing popularity of Bitcoin, many people step back, being afraid to enter a business sector with so much volatility. And this reaction is understandable, knowing the bear markets over time.

However, the CEO of BlackRock is encouraging more people to join. From his point of view, it’s perfectly normal for Bitcoin to be volatile, since it still has a small market capital in comparison to other fiat currencies.

The more people have the courage to join the crypto market, the better the stability of its value will be until it reaches the same financial power as any other fiat.

How can you join the Bitcoin hype too?

If you didn’t have the courage to join until now or you simply didn’t know about Bitcoin before the big news of 2021, now is the right time to become part of the bitcoin community.

In order to buy Bitcoin, you just need to get a crypto wallet and go directly to crypto trading exchange sites. BesteBank even wrote a detailed article on how to buy bitcoin in the Netherlands with exchanges like Bitvavo, so you can get some ideas from there. Further is it a good idea to follow the latest and most important news items on Bitcoin Daily. Keep yourself informed and educated on the topic.

Conclusion

The Bitcoin growth and the transition of so many companies to Bitcoin are great news, the cryptocurrency field finally getting the recognition it deserves. Soon, the world will no longer be so exposed to the financial issues caused by centralized rent seeking units, with people being able to make transactions directly, without unnecessary intermediaries. How more people learn about this unique opportunity and value proposition bitcoin represents, how quicker this new monetary technology will get adopted by retail and institutional investors. The emergence of bitcoin as a new asset class for institutional investors is just warming up.