By Tofiq Aliyev
On Oct 14, 2020
Gemini CEO Tyler Winklevoss predicts institutional investment “tsunami” is coming to Bitcoin. According to Bitcoin billionaire, MicroStrategy’s and Square Inc.’s massive purchase of bitcoins was just the beginning of the flow of institutional investment into the leading cryptocurrency. Winklevoss had previously said that due to inflationary pressure in the US monetary system, the fundamentals of Bitcoin are now powerful than ever.
Nowadays, bitcoin investments of companies are on the trend in the cryptocurrency market. In the past months, US-based MicroStrategy purchased a total of $ 425 million worth of Bitcoin. Following the business intelligence firm, Square Inc. recently invested approximately $ 50 million in Bitcoin. Tyler Winklevoss stated that these massive BTC purchases were just the first drops of the capital “tsunami” coming into the Bitcoin. In other words, Bitcoin acquisitions by high-profile institutions, expected to increase the confidence of other investors. A few days ago, he posted the following tweet predicting the influx of new institutional investments in the Bitcoin.
“First, it was Michael Saylor and the publicly traded MicroStrategy who bought Bitcoin for $ 425 million. Today, Jack Dorsey and Square buy $ 50 million worth of Bitcoin. Tomorrow, there will be another visionary leader and another and another. So, the tsunami is coming.”
Meltem Demirors, Chief Strategy Officer of CoinShares, says recent investments highlight the evolution of Bitcoin as a viable and regulated asset. Meanwhile, industry players are wondering which will be the next firm.
“Bitcoin is a highly liquid asset that trades 24 hours a day, seven days a week in an increasingly regulated and structured global market. And it is an effective portfolio diversifier!”
In addition to the purchase announcement, Square also released a document detailing how it purchased 4,709 BTC. The main purpose of the publication of this document was to guide other companies wishing to make similar-sized purchases. In the published document, the Square team also explained how they purchased bitcoin under US regulations. Amrita Ahuja, Chief Financial Officer of Square, said bitcoin has the potential to become a more “ubiquitous” currency. Then, this investment decision had described by her as a step towards a more comprehensive future.
“We trade a spread on top of a public bitcoin index, and we trade using a time-weighted average price (twap) over a predetermined 24-hour period with low expected price volatility and high market liquidity, to reduce the risks associated with cost and prices. ”
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