A new type of institutional investor is fueling this year’s dramatic bull run, and with it a rise in bitcoin, according to a new report from digital asset management firm CoinShares.
London-based CoinShares analyzed market trends from January through June 2019 and identified significant differences between the 2017 market rally and the current one, with a widespread focus around bitcoin and a rally in altcoins.
The report therefore hails the long-awaited influx of ‘institutional money’ into the bitcoin space, citing Fidelity, which this year announced its intention to launch institutional-grade bitcoin custodial services, as being something of a game changer.
CoinShares also points to several other large businesses moving into the arena: Microsoft, Starbucks and the Intercontinental Exchange are together launching the Bakkt exchange, which is seeking permission to sell physically settled bitcoin futures.
The report further cites Facebook, which plans to run a digital currency – Libra – from a Swiss bank account governed by a consortium of 27 Silicon Valley experts, although this has resulted in a backlash from regulators.
But the report is upbeat on the move: ‘While Libra is centralized, permissioned, trust-based, not censorship-resistant, not scarce and arguably not even a crypto-currency at all, it does offer potential benefits to the world’s unbanked who currently don’t have access to services we take for granted in the West, such as online shopping.
‘Libra’s launch marks a watershed moment in the history of crypto-currencies. The adoption of crypto-currency as a legitimate technology by such a large number of household corporate names immediately counteracts years of negative and uninformed press around crypto-currencies. It further lowers the threshold to participate in this space for countless ordinary people.
‘Nothing is certain in this space and things often feel like they move at a breakneck pace, but we are beyond excited about the rate at which this industry is developing and look forward to seeing what the next half-year brings.’