Bitcoin

Grayscale’s Bitcoin Trust reaches all-time high – institutional investors on the rise

Demand for Bitcoin from institutional investors continues to rise. Between July and September, $1.05 billion was invested in Grayscale’s investment products, the majority of which was in Bitcoin. This was the third consecutive record quarter for the company.

Grayscale Investments, the world’s largest digital asset
management company, published its third quarter investment report, which shows another exceptional quarter for institutional interest in Bitcoin.

The highlight of the report is that the 3rd quarter of 2020 was the most successful quarter in Grayscale’s history. During this period investors invested $1.05 billion in Grayscale’s products. This was the largest cash inflow the company has seen in a single quarter since its inception.

Grayscale’s Bitcoin Trust breaks records

Of all its products, the Grayscale Bitcoin Legacy Trust was the largest contributor of funds, raising approximately $720 million in the last quarter.

GBTC also proved to be the best performing product for Grayscale in terms of assets under management, which increased from $1.9 billion to $4.8 billion since the beginning of the year. This clearly demonstrates the continued strong interest in Bitcoin.

Grayscale further stated that demand for other investment products has also increased. In this context, 31% of the investments were in products other than the Bitcoin Trust. These inflows show that investors are also optimistic about Altcoins.

Among the alternative products, the report found that investors‘ strongest demand was for the Grayscale Bitcoin Cash Trust (BCHG), Grayscale Litecoin Trust (LTCN) and Grayscale Digital Large Cap Fund (GDLC).

Financial institutions want crypto currencies

Grayscale reported that more than 80% of investments in its products during the quarter came from institutional investors. Here, hedge funds dominated institutional investments.

The report also mentioned that capital inflows into the various products since the beginning of the year exceeded $2.4 billion. This is more than twice as much as the $1.2 billion in investment funds that the company has hedged for its products between 2013-2019.

Another point is the astonishing increase in assets managed by Grayscale in the last quarter. Assets under management for all products reached an all-time high in the third quarter. They rose from $2.0 billion to $5.9 billion, up 195%.

Continued growth in Grayscale’s crypto-currency investment products could be an indication of what lies ahead for the rest of the market. This is another area where Bitcoin is at the forefront and is currently the most attention-grabbing product.