Institutions make record investments into Bitcoin & Ethereum

Institutions Make Record Investments Into Bitcoin & Ethereum

Last updated on December 8th, 2022 at 09:30 am

Digital asset management giant, Grayscale, recently published a new report, offering some rather interesting numbers.

According to the report, institutional investors seem to have made a move towards crypto. They invested massive amounts of money into the space.

While Bitcoin (BTC) was an obvious choice of institutional investors, Ethereum (ETH) was also a new comer to this investing ecosystem.

Ethereum Inflows Exceed BTC By $110 Million

As Grayscale’s Q1 2020 report says, institutions seem to have developed a rather serious interest in ETH. Grayscale Ethereum Trust itself recently received a record quarterly inflow, on which the report makes its deduction.

DTC Capital’s head of crypto investments, Spencer Noon, also spoke about the new interest in Ethereum. Noon said that the numbers indicate that ETH is reaching a turning point with institutional and wealthy investors.

The Grayscale report revealed that “[Grayscale] Ethereum Trust saw $110 Million in Q1 inflows. This is more than all of its previous inflows combined for the past 2 years ($95.8M).”

Not only that, but inflows into Ethereum actually managed to surpass inflows into Bitcoin during the last few weeks of Q1.

The first quarter saw a total of $389 million that got poured into the Grayscale Bitcoin Trust. However, Ethereum received as much as $110 million more than that, a total of $498.9 million.

One thing to note is that Grayscale’s digital asset trusts are fully backed and by real cryptocurrency, no less.

Apart from these two coins, Grayscale also offers exposure to others. Some of them include XRP, Bitcoin Cash (BCH), Litecoin (LTC), Stellar (XLM), Zcash (ZEC), Ethereum Classic (ETC), as well as Horizen (ZEN).

Grayscale also saw a record inflow across all of these products, which reached a total of $503.7 million, as the report reveals.

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Interesting Time For Institutions To Join Crypto

Interestingly enough, Grayscale concluded that investors are willing to turn to its crypto products even now. This comes as a surprise, considering the high risks and low willingness to take them across the global macro environment. Not only are institutions developing a taste for crypto, but the timing itself is rather curious.

After all, there are almost no assets that are risk-free right now, due to the coronavirus pandemic-caused fears. Traditional markets have crashed, the crypto market is struggling and there is a lot of uncertainty even when it comes to the value of the USD, the world’s strongest fiat currency.

Even with a situation like that, Grayscale reports that “Investors are tactically using drawdowns to increase their exposure to the asset class, even in a ‘riskoff’ environment. Our institutional investor segment also continued to expand, a trend that could gain additional momentum as legacy financial institutions reinforce the investment thesis for the asset class.”

This is a new and unusual time for the crypto industry, as a lot is happening right now.

Bitcoin is going above and below the $7k mark, struggling to remain above this level when it passes it, or to breach it when it is below it. Meanwhile, the halving is only a few weeks away, with many among the crypto community expecting it to bring a new major rally, while others claim that this will not happen this time.

Obviously, any price surge would likely strengthen the institutions’ resolve to get into the crypto sector even further. Meanwhile, it would continue to spread awareness and attract even those who still remain hesitant to join the crypto industry.


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