Long on Bitcoin: Institutional Investment Driving Recent Crypto Bull Run

Institutions Driving Recent Crypto Bull Run

Institutions Driving Recent Crypto Bull Run

This past weekend, Bitcoin’s price reached nearly $50,000. While the end of 2020 and the first quarter of 2021 have seen astronomical moves for the prices of most digital assets, the bull run we are experiencing can be credited to the influx of institutional confidence that has been poured into the crypto market by some of the most influential companies in the world.

Incited by PayPal announcing their integration of cryptocurrency payments in October 2020, the institutional acceptance has been exploding. Since then, the largest institutional crypto allocations in history have taken place.

MicroStrategy, originally a business intelligence firm, has become a Bitcoin firm. The firm announced their first bitcoin purchase in August, locking in $250 million in BTC. Since then, the company has purchased Bitcoin more aggressively than any other company in the world, with $3.3 billion in holdings as of Friday – about 71,000 bitcoins. MicroStrategy CEO Michael Saylor commented in a statement on Bloomberg TV, “In an expansionary, monetary environment, you want scarce assets… The scarcest asset in the world is Bitcoin. It’s digital gold.”

And scarcity is becoming the universal sentiment. Bitcoin is the scarcest asset on the market with a widespread existential dilemma: everyone wants more of it, but there’s not enough left. With MicroStrategy leading the charge for institutional investment, companies worldwide are racing to secure their own Bitcoin. Just last week, Tesla announced an allocation of $1.5 billion towards Bitcoin, the largest single investment in the asset’s history. Tesla’s investment gave the token even more legitimacy, inspiring the recent bull run for Bitcoin and congruent tokens to the new all time highs reached over the past week. 

While notables, MicroStrategy and Tesla are not the pioneers to this allocation. Crypto’s recognition is spreading across industries, from Wall Street to Hollywood celebrities. Guggenheim recently released a statement saying that they are considering a possible allocation of up to 10% of their $5.3 billion Macro Opportunities Fund. Alliance-Bernstein followed suit, saying the cryptocurrencies do have a place in asset allocation. 

Not only are institutions investing, some are really getting in on the fun. JPMorgan recently announced their new digital asset branch, Onyx, as well as their new stablecoin, the JPM Coin, for interbank and worldwide transaction efficiency. Alongside JPMorgan, Fidelity Digital Assets is becoming one of the largest crypto custodying and lending companies in the game, with Goldman Sachs and similar entities following suit in providing digital asset services as well as blockchain development.

Of course, new all time highs are exciting, and they are blinding for any asset and its audience. But what’s different between the current bull run and 2017’s is that Bitcoin and cryptocurrencies are not experiencing as much volatility. Yes, Bitcoin’s price has the potential to rise and fall significantly everyday, but its value is holding up – its momentum and belief system is solidifying – and this legitimacy is stronger than ever before. These large corporations are giving crypto the validity that it needs to be widely accepted, which raises the question: if these renowned firms are investing, why aren’t you?

For more information on Bitcoin, digital assets, or are curious about how to invest, please visit our website www.sarsonfunds.com or reach out to one of our team members, here.

By Liam McDonald

JPMorgan: Launch of “JPM Coin” and Digital Asset Branch “Onyx” Will Force Wall Street to Embrace Blockchain

JPMorgan's Launch of Crypto Shifts Wall Street Sentiment of Digital Assets-Sarson Funds-Cryptocurrency Financial Advisor

JPMorgan's Launch of Crypto Shifts Wall Street Sentiment of Digital Assets-Sarson Funds-Cryptocurrency Financial Advisor

On Oct. 27th, JPMorgan announced the launch of their long-awaited “JPM Coin,” along with Onyx, their new branch for digital asset operations and custody services.

JPMorgan’s move, while contradicting to CEO Jamie Dimon’s 2017 claim that Bitcoin is a “fraud,” strategically places the bank along the cutting edge of financial technology, giving JP Morgan a strong positioning as the new age of decentralized financial services arises.

The launch of the JPM Coin along with Onyx is more than just JPMorgan jumping on the blockchain bandwagon. Rather, the launch of these services is indicative of the bank’s belief in the ever-expanding potential and use cases of blockchain technology to be a profitable and cost efficient approach to the future of financial services.

Takis Georgakopoulos, JPMorgan’s global head of wholesale payments, stated in an interview last week about blockchain’s profitability, “We are launching Onyx because we believe we are shifting to a period of commercialization of those technologies, moving from research and development to something that can become a real business.”

Similarly, the bank plans on utilizing the permissionless efficiency of blockchain technology as it looks to build out cost effective solutions to risky interbank transfers and cross-border payments. Blockchain technology, as we all know, is no stranger to near immediate global value transfers with just the tap of a finger. To assist in their effort to rebuild the traditional flow of money, JPMorgan has launched Liink, a P2P network built on the Onyx blockchain platform to automatically validate payments and assist in quick, secure transactions that remove the risk of third party interference and lag time.

As the crypto ecosystem enters into the era of widespread adoption, banks must future-proof themselves by recognizing trends in financial technology and embracing fintech momentum. In this day and age, it is imperative that banks alter their outdated approach to financial services and adapt a new, more efficient approach to banking: harnessing the power of blockchain technology. As JPMorgan pioneers Wall Street’s blockchain presence, financial services companies will soon be forced to follow suit in order to stay afloat in an increasingly decentralized world.

By Liam McDonald