{"id":95,"date":"2020-12-30T11:02:46","date_gmt":"2020-12-30T11:02:46","guid":{"rendered":"https:\/\/coinrabbit.io\/blog\/?p=95"},"modified":"2025-01-22T16:39:55","modified_gmt":"2025-01-22T16:39:55","slug":"institutional-investors-the-future-of-crypto-is-in-their-hands-or-is-it-not","status":"publish","type":"post","link":"https:\/\/coinrabbit.io\/blog\/institutional-investors-the-future-of-crypto-is-in-their-hands-or-is-it-not\/","title":{"rendered":"Who are Institutional Investors in Crypto?"},"content":{"rendered":"
<\/div>\n

Institutional investors are believed to drive the cryptocurrency market\u2019s adoption and growth. Their involvement promises to make crypto widely recognized and accepted as a truly global currency. Bitcoin is expected to gradually become an alternative to gold and skyrocket to unprecedented price levels.<\/p>\n\n\n\n

But is this really how institutional investors work? In which direction are they actually driving the crypto market\u2014and, after all, who are they? In this article, we\u2019ll explore the latest examples of major whales\u2019 interest in crypto, uncover the reasons behind it, and describe how they\u2019re truly affecting the market.<\/p>\n\n\n\n

Summary: <\/strong>Traditional markets are bringing less profit than before, leading large investors to find crypto investing lucrative. Although they were skeptical in the past, the crypto market now appears mature and reliable enough to attract significant investments. Institutional investors are poised to bring stability and efficiency to the crypto market.<\/p>\n\n\n

What\u2019s happening? <\/h2>\n\n\n

First, let\u2019s review the latest developments\u20142020 was a landmark year for institutional investors entering the crypto space:<\/p>\n\n\n

Microstrategy investments<\/h3>\n\n\n

In August and September, this Nasdaq-listed business analytics and mobility platform invested over $425 million in Bitcoin. In December, they added another $50 million, even with BTC already over $19K. Today, with the current market cap growth, Microstrategy\u2019s Bitcoin holdings exceed $700 million, setting an inspiring example for other corporations.<\/p>\n\n\n

Public support for Bitcoin<\/h3>\n\n\n

BlackRock, an American global investment management corporation with $8 trillion in assets under management, recently expressed optimism about Bitcoin. Their chief investment officer of fixed income, Rick Rieder, called Bitcoin a highly functional asset that\u2019s gaining popularity among millennials. He even suggested that Bitcoin \u201ccould take the place of gold to a large extent\u201d in the future\u2014an unprecedented endorsement from an institution of this caliber.<\/p>\n\n\n

PayPal to support cryptocurrency<\/h3>\n\n\n
\"\"\/<\/figure>\n\n\n\n

Starting in early 2021, PayPal\u2019s 361 million users were given the ability to buy, sell, and hold Bitcoin, Ether, Litecoin, and Bitcoin Cash. The company aims \u201cto increase consumer understanding and adoption of crypto coins,\u201d a move perfectly aligned with this article\u2019s topic. Another payments platform, Square, had already announced investing 1% of its assets into Bitcoin.<\/p>\n\n\n

36% of institutions have invested in crypto<\/h3>\n\n\n

A survey by Fidelity Digital Assets revealed that 36% of institutions have invested in crypto, with participation increasing among European companies (45%) and American firms (27%) compared to the previous year. The findings confirm a growing interest in digital assets as a new class of investable assets.<\/p>\n\n\n

What is driving the investors\u2019 interest? <\/h2>\n\n

Safe Assets Are in Crisis<\/strong><\/h3>\n\n\n

Traditional methods of preserving wealth, such as savings accounts and high-quality bonds like U.S. Treasuries, are yielding much lower returns than before. In some cases, profits are so low that inflation erodes them, turning real returns negative. In contrast, cryptocurrencies like Bitcoin have shown extremely high long-term ROI, making them attractive to investors.<\/p>\n\n\n

Discouraging Fiscal Policies<\/strong><\/h3>\n\n\n

Countries like Denmark, Switzerland, and Japan have implemented negative interest rates to combat deflation. While beneficial for their economies, such rates do little to entice traditional investors, pushing them to explore alternatives like crypto.<\/p>\n\n\n

Crypto\u2019s Rapid Growth<\/h3>\n\n\n

With swift advancements in blockchain technology, the crypto market now boasts promising and credible projects offering high ROI<\/p>\n\n\n

Fear of Missing Out (FOMO)<\/strong><\/h3>\n\n\n

The days of the unregulated ICO craze in 2017 are over. Today, effective regulations in many jurisdictions have increased confidence in the crypto market, reducing risks of scams and frauds.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n

Institutional Investors’ Impact on the Market<\/strong><\/h2>\n\n\n

With all the examples and reasons discussed, let\u2019s now explore how whales actually affect the market:<\/p>\n\n\n

Institutional Investors Help the Crypto Market Mature<\/strong><\/h3>\n\n\n

A common misconception is that whales will centralize the crypto market, undermining its initial vision of a trustless, intermediary-free decentralized ecosystem. On the other hand, some believe that the influx of institutional investors will cause Bitcoin prices to skyrocket. These are polarizing views that are, in reality, far from the truth.<\/p>\n\n\n\n

The reality is that institutional investors use their experience to limit risks and maximize returns. This approach helps combat volatility and increase liquidity in the market, leading to the following outcomes:<\/p>\n\n\n

Yields Might Decrease, but That\u2019s Inevitable<\/strong><\/h4>\n\n\n

As markets mature, increased stability naturally comes with reduced volatility. This is a standard progression in any market. Bitcoin is still likely to deliver substantial ROI in the near future, but these extraordinary gains may not last forever. Whales will trade high volatility for steadier, albeit less dramatic, returns.<\/p>\n\n\n

Investors Themselves Are Not Crucial for Bitcoin\u2019s Growth<\/strong><\/h4>\n\n\n

Other factors, such as Bitcoin\u2019s adoption rate and the current macroeconomic environment, play a much larger role in shaping its trajectory. While institutional investors are a significant part of the ecosystem, they are not the sole driving force. For example, PayPal\u2019s recent crypto integration has the potential to triple Bitcoin\u2019s user base. Experts predict that such developments will have a massive impact on the industry, likely more than institutional investors alone.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n

Seize your opportunities in crypto!\u00a0<\/h2>\n\n\n

While the whales mentioned above buy and hold Bitcoin, many regular users aim to maximize their profits from the crypto market. Selling Bitcoin may not seem like the best option right now, but the desire to utilize this cryptocurrency remains strong. Cryptocurrency lending<\/a> services like CoinRabbit allow users to get a crypto loan in USDT <\/a>in a fast and secure way. While you still own your Bitcoin<\/a>, you now have some extra money for your current needs. You can back to our crypto lending platform to repay your cryptocurrency loan at any time. Learn more about using your Bitcoin without selling it here<\/a>.<\/p>\n\n\n

\n
\"get<\/a><\/figure>\n<\/div>","protected":false},"excerpt":{"rendered":"

Institutional investors are believed to drive the cryptocurrency market\u2019s adoption and growth. Their involvement promises…<\/p>\n","protected":false},"author":13,"featured_media":96,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_eb_attr":"","_uag_custom_page_level_css":"","ub_ctt_via":"","_lmt_disableupdate":"","_lmt_disable":"","_themeisle_gutenberg_block_has_review":false,"footnotes":""},"categories":[714,716],"tags":[13,34],"ppma_author":[654],"class_list":["post-95","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-education","category-long-term-investing","tag-bitcoin","tag-crypto-investing","author-olga"],"aioseo_notices":[],"featured_image_src":"https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5.jpg","author_info":{"display_name":"Olga Davis","author_link":"https:\/\/coinrabbit.io\/blog\/author\/olga\/"},"modified_by":"Olga Davis","uagb_featured_image_src":{"full":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5.jpg",1200,630,false],"thumbnail":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5-150x150.jpg",150,150,true],"medium":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5-300x158.jpg",300,158,true],"medium_large":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5-768x403.jpg",768,403,true],"large":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5-1024x538.jpg",1024,538,true],"1536x1536":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5.jpg",1200,630,false],"2048x2048":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5.jpg",1200,630,false],"wptouch-new-thumbnail":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5.jpg",144,76,false]},"uagb_author_info":{"display_name":"Olga Davis","author_link":"https:\/\/coinrabbit.io\/blog\/author\/olga\/"},"uagb_comment_info":0,"uagb_excerpt":"Institutional investors are believed to drive the cryptocurrency market\u2019s adoption and growth. Their involvement promises…","blog_post_layout_featured_media_urls":{"thumbnail":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5-150x150.jpg",150,150,true],"full":["https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2020\/12\/5.jpg",1200,630,false]},"categories_names":{"714":{"name":"Education","link":"https:\/\/coinrabbit.io\/blog\/category\/education\/"},"716":{"name":"Long-term Investing","link":"https:\/\/coinrabbit.io\/blog\/category\/long-term-investing\/"}},"tags_names":{"13":{"name":"bitcoin","link":"https:\/\/coinrabbit.io\/blog\/tag\/bitcoin\/"},"34":{"name":"Crypto investing","link":"https:\/\/coinrabbit.io\/blog\/tag\/crypto-investing\/"}},"comments_number":"0","authors":[{"term_id":654,"user_id":13,"is_guest":0,"slug":"olga","display_name":"Olga Davis","avatar_url":{"url":"https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2025\/11\/olga.jpeg","url2x":"https:\/\/coinrabbit.io\/blog\/wp-content\/uploads\/2025\/11\/olga.jpeg"},"author_category":"3","first_name":"Olga","last_name":"Davis","user_url":"https:\/\/medium.com\/@olga_davis","job_title":"","description":"Nice to e-meet you!\r\n\r\nI\u2019m passionate about Web3 and its power to reshape the digital world with transparency and true freedom. The future is decentralized, and I\u2019m here to help you navigate this exciting new frontier."}],"brizy_media":[],"_links":{"self":[{"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/posts\/95","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/comments?post=95"}],"version-history":[{"count":7,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/posts\/95\/revisions"}],"predecessor-version":[{"id":5946,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/posts\/95\/revisions\/5946"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/media\/96"}],"wp:attachment":[{"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/media?parent=95"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/categories?post=95"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/tags?post=95"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/coinrabbit.io\/blog\/wp-json\/wp\/v2\/ppma_author?post=95"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}