Institutional Investors are Still Optimistic About Bitcoin

Recent insights from Matthew Sigel, who leads Digital Assets Research at VanEck, and J.P. Morgan, shed light on why institutional investors are still optimistic about Bitcoin.

According to the research, several factors contribute to this positive outlook.

Firstly, a notable change at Morgan Stanley is that their wealth advisors are now allowed to recommend spot Bitcoin ETFs to clients. This development signifies an increased acceptance of BTC ETFs within traditional investment frameworks.

The research also highlights that most of the liquidation events tied to the Mt. Gox and Genesis bankruptcies are likely concluded. This reduction in liquidation-related selling pressure is expected to create a more stable market environment.

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Additionally, the anticipated cash distributions from the FTX bankruptcy later this year could boost demand in the crypto market.

JPM: “One can find several reasons for institutional investors to remain optimistic [about #bitcoin]:
1. Morgan Stanley has recently allowed its wealth advisors to recommend spot bitcoin ETFs to their clients.
2. The bulk of liquidations of in-kind crypto payments from Mt. Gox… pic.twitter.com/vRxKgyirFU

— matthew sigel, recovering CFA (@matthew_sigel) August 8, 2024

Furthermore, J.P. Morgan observes that favorable regulatory signals from both major US political parties are creating a more stable regulatory environment for institutional investors.

Lastly, J.P. Morgan points out that there is limited de-risking in the Bitcoin futures market. The futures prices are currently higher than spot prices, a situation known as contango, which reflects a positive sentiment among futures investors.

Kosta Gushterov