Luno – a Malaysia-based digital assets exchange – released a statement stating that the institutional interest that sparked Bitcoin’s meteoric price spikes in 2020 is expected to continue this new year.
Luno says the institutional love for BTC will last until 2021
In 2020, many large institutional companies – including MicroStrategy, MassMutual, and Stone Ridge – invested hundreds of millions of dollars by market cap in the world’s largest digital currency. The idea was that thanks to the ongoing coronavirus pandemic, inflation was rising and Bitcoin was now at the same level as gold and was a serious way to keep your wealth stable and stable during times of economic turmoil.
BTC was no longer viewed as just a speculative asset. It was now a store of wealth; a hedging tool, if you will, that could make sure your finances are well protected.
Luno’s Country Manager – Aaron Tang – stated:
The latest news that the S&P Dow Jones indices will launch cryptocurrency indices in 2021 should bring the cryptocurrency to even more investors every day. It’s something that has been talked about the longest. However, 2020 seemed to be the turning point. The year institutions really started investing significant amounts of money in cryptocurrency. We assume that this trend will continue in 2021.
Additionally, Tang stated that Bitcoin’s Google searches were significantly higher in 2020 than three years ago, when Bitcoin hit its “old” all-time high of over $ 19,000. During this time, the rise in Bitcoin prices was mainly driven by retail investors who were crazy about ICOs (Initial Coin Offerings). These token offers have since taken on a new meaning, considering how many were fake and fraudulent, and this could have contributed to merchants’ massive losses in the following 2018.
However, Tang says that this time around was completely different and that the institutions were the main force behind the spike, rather than the retailers. He says:
We believe that a continued increase in media attention would certainly change that, but perhaps more importantly, it is now much easier than ever to buy Bitcoin. Not only are there platforms like Luno that support customers around the world, but there are also companies like PayPal and Square that are doing great things in the US
Blockchain is getting stronger
He goes on to state that the coronavirus pandemic, which has forced many people into lockdown status, is keeping people at home and using new technology to achieve goals and meet certain needs for themselves. He mentions:
As cryptocurrencies and digital assets continue to grow in importance, they will continue to attract regulatory attention. Progressive regulations are vital to the healthy growth of any industry. We hope that regulators continue to balance the need for rules with the room for innovation.