Institutions Hold the Line: No Sellers in Sight During Bitcoin's Bear Market
When Bitcoin's price plummeted from $125K to $60K, institutions didn't sell out. In fact, many bought more, according to Ryan Rasmussen, head of research at Bitwise. The firm's first institutional crypto adoption report revealed that sovereign wealth funds are treating Bitcoin alongside gold as a hedge against debasement.
During the bear market, not one of the 15 major institutions interviewed by Bitwise sold their Bitcoin holdings. In contrast, many institutions took advantage of lower prices to buy more Bitcoin. This is in line with the 'debasement thesis', which posits that inflation and currency devaluation can be mitigated by holding assets such as gold or Bitcoin.
The report highlighted several notable examples of institutional investors allocating a significant portion of their portfolios to Bitcoin. Wells Fargo, for instance, has allocated 2-3% of its portfolio to Bitcoin, while Fidelity and BlackRock have allocated 2-8%. The firm also noted that the introduction of Bitcoin ETFs helped make this bear market shallower.
Bitwise believes that the bottom of the Bitcoin price was $60K. The report highlighted the growing interest in institutional investors in cryptocurrencies, with $2.5B in weekly ETF inflows and a new wave of capital entering the market.