Bitcoin Bullish Run Buoyed By Positive Sentiments from Institutions
Bitcoin rise in recent weeks has been exponential with the leading coin pumping from $13,000 to $19,000 in less than two months. This rapid surge in price has echoed similar sentiments to the bullish run of 2018 but with a distinct difference “institutional adoption.”
Institutions Accumulating Bitcoin In 2020
Financial institutions’ accumulation of Bitcoin is the most noticeable trend in 2020.
This suggests that the leading coin is viewed highly within the mainstream financial sector. In recent months, Grayscale has made a massive investment in crypto assets totaling around $10 billion. Microstrategy followed a similar note with the investment firm making two separate purchases of Bitcoin worth over $220 million.
The successes of these companies holding Bitcoin has created a race from other financial firms to hold the leading crypto asset. American bank JPMorgan revealed in its recent report that institutions are accumulating Bitcoin at a stronger pace this quarter than they were in Q3.
The report suggested that institutional investors view Bitcoin as a long-term investment. Citing the growing size of Grayscale Bitcoin Trust, JPMorgan analysts believe that many institutional investors are in for the future. Apart from institutional investors, the Bitcoin retail industry has also witnessed record highs in the demand for Bitcoin.
Adoption Could Drive more Use Cases for Bitcoin
PayPal CEO Dan Schulman is of the opinion that the increasing adoption of Bitcoin would create new use cases for the coin. Speaking on CNBC, Schulman stated that Bitcoin will go beyond the current buy and hold wave that dictates the market.
“I think that there’ll be more and more use cases for cryptocurrencies,” that make bitcoin more widely accepted, more stable and probably “more valuable” over time,” he said.
Schulman also believes the introduction of central bank digital currencies is inevitable as central banks across the world adapt to the growing use of crypto assets. PayPal is among the institutions to jump on the crypto train in 2020 with the payment processing platform allowing users to purchase cryptocurrencies.
At the moment only users in the US can use the functions but PayPal plans to extend this to cover more countries by 2021. Institution adoption of Bitcoin is good for the crypto industry which typically follows in the direction of the leading coin.