Barry Silbert of Digital Currency Group (DCG owns Grayscale and Coinbase among other crypto-related holdings) says bitcoin bears “ran out of bitcoin to sell.” While offering up his opinion that bitcoin price is establishing a bottom at this point, he goes on to point out institutional money is looking for an entry point. Hopefully Coinbase Custody will help get them interested in buying and holding bitcoin and crypto. Silbert addressed the current bitcoin bear market in his comments on CNBC earlier today.
The current bitcoin bear market began earlier this year after bitcoin prices topped $20K in December 2017. The crypto markets have gyrated back and forth during 2018, sometimes rising briefly to good news or reports of increasing crypto coverage by more mainstream outlets. But the trend has certainly been downward since the bitcoin highs. Increasing focus on regulation and reports of Mt. Gox selling large quantities of bitcoin may have contributed to price declines.
Silbert believes financial giants don’t want to be the first to move in, but that companies will be quick to jump in after the first one makes a move. Grayscale has attracted $250 million year to date, and 50% of that has come from institutions. Grayscale manages their bitcoin investment trust (GBTC available to retail investors) along with funds for accredited investors only offering a basket of bitcoin, litecoin, Ethereum, bitcoin cash, and Ripple’s XRP in their Digital Large Cap fund as well as coin-specific funds for several cryptoassets. The restricted funds will likely be opened to retail investors eventually.
Overall he points out that institutions will be more critical of crypto projects and more discerning when choosing where to place their crypto allocation money. For whatever his motivations, he specifically mentions bitcoin, Ethereum classic, zCash, Decentraland, ZenCash. Note that these are Digital Currency Group’s current holdings.
For what it’s worth, we agree with Barry. Too many big investment firms have too many plans for entering these markets for the prices to remain low for much longer. For more on getting started with bitcoin, be sure to read “Easy Ways to Buy bitcoin.”
From Silbert’s mouth to the market’s ears, we say.
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