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Bitcoin Garners Increased Pension Interest Amid Bull Run

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Bitcoin is now valued at $40K while its market cap resides at $751.18 billion. While Bitcoin is increasing without a stop, institutional investors seem to be pouring in their money into the industry. While other coins are catching up, Bitcoin made it clear that it was untouchable as the largest cryptocurrency. Bitcoin’s price movement has reportedly lured in investors eyeing pension funds as well as endowments. Grayscale’s latest CEO shed light on the same in a recent chat with Bloomberg.

Bitcoin Investment Prevails In Several Forms

Grayscale recently revealed that it would stop trading of XRP until the platform got a better picture of the SEC lawsuit against Ripple. Albeit this blip, other assets have been garnering immense traction on the crypto platform. Grayscale’s newest CEO, Michael Sonnenshein spoke to Bloomberg about the latest institutional interest in Bitcoin. He said,

“We’ve started to see participation not just from the hedge fund segment, which we’ve long seen participation from, but now it’s recently from other institutions, pensions and endowments. The sizes of allocations they are making are growing rapidly as well.”

Barry Silbert recently stepped down from his post as the CEO of Grayscale Investments and Michael Sonnenshein took over as the CEO. Sonnenshein had taken over an array of roles in the past seven years at Grayscale itself. Silbert revealed that he wanted to concentrate on his other company, the Digital Currency Group.

The latest bull run brought in major inflows into the Bitcoin Trust. While 2020 was rather disastrous, Grayscale seemed to have had quite a beneficial year. Last year, Grayscale managed around $2 billion in assets, however, Sonnenshein revealed that the crypto platform currently manages over $25 billion in assets.

Elaborating on the limited supply of the king coin, Sonnenshein added,

“So there is definitely an argument to be made about Grayscale and really any other vehicle that may be removing Bitcoin from circulation and putting it into a financial product inherently increasing the scarcity of an already scarce asset. This is a verifiable scarce asset and so when there are mechanisms that are removing them from circulation, that’s inherently making it an even scarcer asset.”

Furthermore, he also pointed out that the crypto rally has surged the demand for Grayscale and the platform reportedly intends to onboard several other employees as it currently harbors only 24 individuals. Sonnenshein stated that the platform would direct its focus on advertising as well as rolling out new products.

Grayscale Hits $23 Billion in AUM as Bitcoin Blasts Past $35k

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Bitcoin’s price has soared wild. Owing to the strong bullish momentum, the crypto fund manager Grayscale has surpassed $23 billion in assets under management [AUM] on the 5th of January, up from $22.8 billion on the 1st of January this year. Since the start of 2020, the platform has increased its holdings by ten times.

Bitcoin has been making and breaking records with each passing day. It crossed yet another milestone of $35.1k before retracing to the press time price of $34.82k. This has paved the way for the altcoin market to register tremendous rally breaching levels not seen since the 2017-2018 bull run.

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The growth that the asset manager has noted in the past couple of weeks has been nothing short of phenomenal. Thanks to the growing customer base of institutions, high net individuals as well as retail investors, the AUM figures have skyrocketed in a short period of time. As Grayscale products continued to attract massive capital inflows, Bitcoin was its largest holdings with a staunching $19.47 billion followed by its Ethereum product [ETHE] at $3.09 billion, Grayscale Litecoin Trust [LTCN] with $178 million.

Taking the opportunity, Grayscale has not only accumulated a massive amount of crypto-assets but has also launched substantial marketing campaigns. One of its most popular was the DropGold. More recently, it launched ‘GoGrayscale’ marketing campaigns to increase awareness about digital assets.

Reportedly, shares of Grayscale Bitcoin Trust [GBTC] soared by nearly 12% on the 5th of January. This was right after JPMorgan issued an extremely bullish forecast for the price of Bitcoin. A popular JP Morgan analyst went on to claim that Bitcoin could potentially rise as high as $146,000

TWJ had earlier revealed how confident the market has been following the stunning rally. Barry Silbert, the Founder, and CEO of Digital Currency Group which owns the digital asset manager had earlier tweeted,

“You all clearly want Grayscale to hit $20 billion in AUM in 2020. I’ll take it”

XRP Makes Way For Litecoin As The Fourth-Largest Asset; Grayscale Kicks Out XRP From Its DLC Fund

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The crypto-verse has been closely spectating the movement of Bitcoin. XRP seems to be the only asset enduring a loss during the ongoing bull run. The crypto industry is so close to hitting $1 trillion, but it appears like XRP wouldn’t be effectively aiding the process. The SEC lawsuit has almost destroyed the altcoin. Over the past few days, several crypto exchanges went on to delist the asset and the list isn’t getting any shorter. A few other members join the list as the asset slips off as the fourth-largest cryptocurrency.

XRP Loses Spot On Blockchain.com

The SEC’s $1.3 billion lawsuit against Ripple seems to have an array of repercussions as XRP has been losing its stance in the crypto-verse. After Coinbase, Bittrex, OKCoin, and several other lesser-known exchanges suspending trading of the asset, Blockchain.com revealed that it would halt trading of the altcoin from 14 January 2021. However, users of the platform will reportedly be able to send out the altcoin that they already have, but cannot acquire extra XRP.

Grayscale also followed suit and bid adieu to XRP. In a recent tweet, the platform revealed its Quarterly review for the Digital Large Cap [DLC] Fund. Grayscale’s DLC entailed other crypto-assets like Bitcoin [BTC], Ethereum [ETH], Bitcoin Cash [BCH] as well as Litecoin [LTC]. But XRP didn’t seem to make it to the list. The tweet read,

In a recent press release, Grayscale further affirmed that it would “temporarily” suspend trading for the altcoin starting from 15 January post 5 PM [ET]. Elaborating on the platform’s reason for removing the coin, the post read,

“According to the Fund’s documentation, during the Fund’s quarterly review, the Manager may determine to exclude a digital asset from the Fund’s portfolio even if it meets the Fund’s Inclusion Criteria, including, but not limited to, if the Authorized Participant does not have the ability to trade or otherwise support such digital asset.”

Earlier this year, the largest stablecoin, Tether [USDT] flipped XRP as the third-largest crypto asset. Now, Litecoin has overshadowed the asset and took over its place as the fourth largest coin with a market cap of $10.63 billion.

XRP

Grayscale Now Has $19 Billion in Crypto AUM; Figures Triple

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It is, without a doubt, that Grayscale has effectively cornered the cryptocurrency industry. Bitcoin’s prices have unfolded tremendously over the holiday week, thanks to the growing institutional investor interest as well as the retail FOMO.

Owing to this, the digital asset manager, Grayscale Investments has hit yet another milestone, after it touched $19 billion in assets under management [AUM] on the 28th of December, up from the $16.4 billion announced just last week. With this, the figures have tripled since the start of November.

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Notably, Grayscale’s trust for XRP witnessed a significant decline all the way from $13.7 million AUM a week ago to the current $11.2 million. This can be attributed to the recent SEC-Ripple fiasco which has prompted intense sell-off.

Nevertheless, Grayscale products have attracted massive capital inflows over the course of the year. According to the latest data by the NY-based platform showed that Bitcoin continued to be its largest holdings with a staunching $16.3 billion followed by Grayscale Ethereum Trust [ETHE] at $2.1 billion, Grayscale Litecoin Trust [LTCN] with $151.3 million.

The world’s leading crypto asset management firm had garnered a lot of traction recently due to its DropGold advertising campaign. To top that, the company reported a growing interest in Ethereum earlier this month.

Besides, Ki Young Ju, who happens to be the CEO of CryptoQuant, revealed that out of the total $186 billion Bitcoin realized market cap, 16% is owned by institutional investors. This comes after Grayscale’s third-quarter investment report disclosed that 80% of investments to its products came from institutional investors, which were dominated by hedge.

In addition to the rising Bitcoin price, yet another factor that has made the US-based platform, realy popular among the experienced and the novice traders alike was the weakening dollar which has triggered institutional adoption. Furthermore, it is no news that certain major Wall Street firms have also integrated digital assets in their investment portfolio to hedge against dollar depreciation.

Confident about the massive figures, Barry Silbert, the Founder and CEO of Digital Currency Group which owns the digital asset manager, tweeted,

“You all clearly want Grayscale to hit $20 billion in AUM in 2020. I’ll take it”

Ethereum Breaches $735 Triggering Over 90% Addresses In Profit

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Late Chrismas Gift for Ethereum?

Ethereum had a bullish start for the day as it broke above $700 for the first time since the last week of May 2018. The largest altcoin was seen lacking bullish momentum as its price movement broke away from that of Bitcoin. However, Ethereum soon climbed to $735.93, at the time of writing after multiple pullbacks close to the coveted level.

According to the crypto-analytic platform, Glassnode, the latest surge triggered 90% of all Ethereum addresses [which roughly amassed for 47 million addresses] holding ETH are now in a state of profit. The last time this number was witnessed to be this high was back in January 2018.

The infamous Black Thursday crash is worth noting in this context because Ethereum has come a long way since then. In March of this year, only 3.2% of all ETH addresses were in profit as opposed to 90% following the spectacular price rise right after Christmas.

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Here’s what Messari’s Ryan Watkins has to say about the latest uptrend:

“2021 prediction: In 2021 we begin seeing institutions buy $ETH. Once you accept that Bitcoin may be valuable, it opens your mind to the possibility that other cryptoassets may also be valuable. It’s a much easier jump from $BTC to $ETH from there.”

While Bitcoin continued to be the darling of institutional investors and corporations, Ethereum was not far behind either. Amassing a market cap of $83 billion, Ether’s success story among institutional investors can be attributed to strong fundamentals. Especially, the decentralized finance [DeFi] sector happened to be one of the hottest and the most exciting thing in the cryptocurrency industry this year.

This helped the second-largest network to hold on to the leadership status as the enormous majority of DeFi projects were based on the Ethereum blockchain. In addition, the growing network activity, in turn, led to increased ETH transaction fees and strong demand for the underlying token.

The growing conviction around Ethereum as an asset class was witnessed this year. This was further evidenced by the Chicago Mercantile Exchange’s [CME] announcement of an upcoming launch of a futures contract on Ether in February 2021. This development was touted as a game-changer for the ETH ecosystem.

To top that, the Grayscale Ethereum Trust [ETHE] registered over $1.7 billion in assets under management [AUM]. It was also found that the shares of ETHE [OTCMKTS: ETHE] had surged by 700% YTD. This has also intensified the bullish outlook as many market participants now believe that once the Bitcoin rally subsides, there will be a capital inflow into altcoins with ETH being the first choice of high-profile investors.

Crypto IPO: A $4 billion IPO can meet Barry Silbert’s DCG future

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When we talk of public-tradable companies in the digital asset industry, very few organizations will come to mind. These organizations are small businesses, and none of the multi-billion dollar corporations has taken a step into the Crypto IPO.

Over the past few years, there have been talks about Coinbase and BlockFi taking the big step forward but nothing constructive has manifested from either side till now. Now, According to Messari, a third party might also soon throw their hat into the Crypto IPO mix, which happens to be Barry Silbert’s Digital Currency Group.

Digital Currency Group or DCG is a venture capital company that has several established crypto businesses under its administration. The organization has been around for over 5 years, and it has developed corporations such as Genesis Global Trading and Grayscale Investments. Additionally, DCG also controlled CoinDesk and Internation retail exchange, Luno, under its wing.

While discussions over a Crypto IPO have not been raised publicly for DCG’s end, the report crunched down some numbers, which indicated that DCG would present a strong case for a successful IPO.

Barry Silbert and his numbers game with Genesis, Grayscale

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According to the report, Genesis recently revealed its quarterly report for Q3 2020. Genesis Global Trading, an OTC crypto trading desk, and crypto lending/borrowing platform, registered loans which surpassed $5 billion on the quarter. The total active loans were estimated to be $2.1 billion which would bring is $42 million annual revenue at the moment.

Additionally, on the trading aside, Genesis registered over $1 billion in derivatives trading and $4.5 billion in spot volumes, where estimated trading revenue is expected to be around $8.8 million.

These are extremely impressive numbers and with respect to Grayscale, the crypto industry already had an idea. Grayscale’s flagship product, GBTC has continued to aggressively accumulate BTC in 2020, currently occupying close to 2% of total circulation. Grayscale was bringing in close to $159 million in revenue per year. The report added,

“With Genesis and Grayscale generating an estimated $50M and $123M a year, that still leaves Coindesk and Luno. On top of that, DCG also has a sizeable investment arm, consisting of both liquid and VC investments that would bring their total valuation to around $4.3 billion.”

DCG’s added advantage for its Crypto IPO

The $4.3 billion valuation of DCG is impressive. It is impressive enough to take the IPO step but Barry Silbert’s organization had an added advantage. One of the key fundamentals before going public is to attain a list of clients that come from an institutional background and high net worth individuals. A retail heavy clientele does not attract that right kind of people to undertake the proceeding of an IPO. For Genesis and Grayscale, it has been their major source of revenue. Genesis trading strictly caters to the demands of institutional investors and in 2019, it facilitated the crypto-fiat lending system due to immense institutional demand.

Grayscale’s stance in the public eye is already clear as day, with the investment wing catering to institutions trying to attain exposure to digital assets. Hence, with Digital Currency Group, a Crypto IPO can be manifested in a matter of months, if Barry Silbert decides to take the company public.

Grayscale’s Bitcoin TV Ad Campaign Explaining the Evolution of Money Yields $217 Million

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Cryptocurrency investment firm, Grayscale has achieved its most significant single fundraising week in its entire lifetime, raking in a massive $217 million. The crypto investment firm has had a smash hit of a week, following the release of its new Bitcoin TV ad campaign.

On August 14, Grayscale’s CEO, Barry Silbert, disclosed through Twitter that the cryptocurrency investment firm had taken in $217 million this week, the most substantial amount it has ever raised in a single week.

Bitcoin TV ad urges people to invest in crypto

The feast began when the crypto investment firm started airing TV ads trailing the gradual development of money, into the era of cryptocurrencies. Following the Bitcoin TV ad, Grayscale’s competitors, Galaxy Digital, posted a full-page advertisement on the Financial Times, stating: “Now is the time to invest in Bitcoin.”

The positive results yielded by Grayscale are a confirmation that the battle to acquire fresh cryptocurrency investors is still going. The battle is being driven towards new boundaries by Grayscale and its rivals such as Galaxy Digital. Grayscale’s Bitcoin TV ad was aired on television channels such as CNBC, MSNBC, FOX and FOX business.

Grayscale’s 2020 growth driven by Ethereum

Grayscale was established back in 2013 by Venture Capital firm, Digital Currency Group, to introduce institutional investors to digital assets. The firm offers trust for digital currencies such as Bitcoin, Ethereum and several others. The most significant catalyst for Grayscale’s development in 2020 has been Ethereum. Notably, the firm purchased nearly as much as half of all the ETH mined during the first half of 2020.

During an investors call in July, the crypto investment firm revealed that it invested $375.5 million on Ethereum fund since it was launched in 2018. Generally, Grayscale reported an influx of over $900 million during Q2 of 2020. During last month’s investors’ call, Silbert notified them that he was carefully positive the U.S. government had changed its mind on outlawing. The CEO cited the increasing number of BTC supporters in government offices in Washington, D.C.

Bitcoin will trade at $180,000 if one-third of Gold’s market is mirrored

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One of the main topics of discussion surrounding Bitcoin ‘s development in 2020 has been the improved interest from the institutional point of view.  As cited before, the Asset Under Management of Grayscale Bitcoin Trust is above $3.5 billion at press time, which is 20 percent higher than back in December 2017, when Bitcoin reached its all-time high of $20,000.

In 2020, some of the key factors identified to drive institutional interest included Bitcoin’s maturity rate, positive sentiment across high-profile investors and organizations, and, finally, strong market fundamentals.

However, Ryan Watkins, Research Analyst at Messari, recently indicated that Bitcoin has barely witnessed significant investment from a major institutional point of view. Watkins suggested that some of the major institutional investors included pension funds, mutual funds, endowment foundations, family offices, sovereign wealth funds, and hedge funds.

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The graph above shows the total assets under management ( AUM) for the above-mentioned investors. It can be seen that a mere 1% AUM of pension funds was estimated at around $400 billion, which is more than two times the current market cap for Bitcoin.

Thus, an aggregated allocation of 1% across all institutional investors would easily improve Bitcoin’s market cap by $1 trillion or, in layman terms, $50,000 per BTC.

Such impressive numbers can only be put into perspective if the capital inflow from this set of investors takes place.

Bitcoin will be valued $180,000 if 1/3rd of Gold’s market is attained

Keeping the institutional interest on the side, one of the other major characteristics of Bitcoin which receives a significant boost over the past few months is its store-of-value narrative.

Bitcoin’s quick recovery following the market collapse in March, saw its stock go up as a hedge against traditional market turbulence, which is usually aligned with Gold or other safe-haven assets.

Bruce Ng and Juan M. Villaverde, Analyst at Weiss Crypto Ratings believed that it is only a matter of time before Bitcoin could mirror Gold’s market presence. Now, Gold had a current market cap of $9 trillion dollars.

Hence, the analyst suggested that if Bitcoin is able to capture even a third of Gold’s business over the next few years, the asset will be trading at $180,000, which is 20 times more than its current valuation.

Therefore, the future looks bright for Bitcoin at the moment as the turbulence of 2020 is bringing out the best in the digital asset.

Ethereum Traders Accumulate ETH but Implied-Volatility Continues to Decline

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In the past week, Ethereum has culminated in a consolidation between $214 and $200, and a sense of stagnation is currently seen in the charts.

The asset struggled to match Bitcoin’s rally early in May, and with bitcoin ‘s momentum slowly fading at the moment, Ethereum could picture a series of low valuations as well.

However, Ethereum traders continue to place significant trust in the valuation of the asset as the hodling trend continues to grow in the network.

ETH scaled

According to glassnode statistics, the number of Ethereum addresses holding more than 100 ETH tokens has reached an all-time high of 47, 722.

A similar sentiment has been observed on the part of Grayscale, as has the accumulation facilitated by the institution over the past year, which has spiked 24 times. Grayscale Invest Ethereum Trust’s Fund Under Management has risen from $11.7 million to $276.5 million given Ethereum ‘s continued low valuation over the past 6 months.

While there was no particular explanation for the holding narrative, many suspected that the imminent launch of ETH 2.0 was generating a sense of anticipation among investors. The initial response received by the update to ETH 2.0 was excellent as the validators flocked to the network.

Volatility at a stand-still?

Now, with regard to the above data, the sentiment of the derivative traders hinted at a sense of contradiction. Analysis of skew market charts indicated that Ether’s 3-month implicit volatility has reached its lowest point since its collapse on March 12.

Now, the drop in implicit volatility is a clear indication that options traders expected a market turbulence pause before another price cycle takes place.

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The chart above suggested that the implied press-time variance had fallen to 4.5 per cent. The IV was as high as 7.8% in mid-March. On the other hand, the realized volatility of the largest altcoin has maintained steady movement in the charts, without hinting at a lot of volatility.

In addition, spot markets have also not remained idle, with digital asset exchanges in the industry continuing to register a high level of outflow. Such a phenomenon has been popular among Bitcoin exchanges, as the number of Bitcoin exchanges has fallen to a historic low.

The shift in sentiment across the industry currently poses a number of questions about the forthcoming price action, but only time will tell how things will shape over the next few months.

Grayscale Bought 50% of Ethereum Minted in 2020 as ETH 2.0 Testnet Garners Positive Response

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Ethereum is currently witnessing one of its most engaging periods in the industry. During the month of March, the coin suffered a major setback but the largest altcoin asset was able to rally back into a strong position.

Now, according to recent reports, Grayscale, one of the largest digital asset manager firm in the industry, is identifying Ethereum’s potential in space, regardless of its recent price scare. A recent Reddit post indicated that Grayscale’s investments had bought close to 50 percent of the Ether mined in 2020. The statistics indicate that the company currently holds 1.1% of the total Eth in the circulating supply.

Grayscale buying Ethereum left and right

According to data, a total of 1,563,245,875 ETHs were mined in 2020 from 1 January to 24 April. During the same period, it was observed that the number of shares issued to the Grayscale Investments Ethereum Trust (ETHE) was 13,255,400 on 24 April. The number was approximately 5,230,200 on 31 December.

On calculating the data, it was analyzed that approximately 756,240 ETH was bought which precisely meant ETHE bought around 49% of the total ETH mined.

Additionally, During the first quarter of 2020, Ethereum Trust accounted for a  $110M of inflows, which is more than all previous inflows combined for the past two years ($95.8M). That is a substantial increase, which suggested that the interest in ETH futures is likely more than what the community expected.

ETHE

Grayscale Ethereum Trust shares are some of the first securities solely invested in and derived from the valuation of Ethereum. The Trust allows its investors to gain exposure and experience with ETH’s price movements through a traditional investment vehicle. Traders and Investors are able to incur the profitability of trading without the challenges of buying, storing, and housing their ETH funds.

At the time of writing, Grayscale currently operated 10 different cryptocurrency investment products focused on institutional investors.

Ethereum 2.0 is gaining attention?

Previously, it was reported that the number of Ethereum validators was also on the rise following the launch of the recent ETH 2.0 testnet. The upcoming release of Ethereum 2.0, which will complete the migration from the current proof-of-work consensus algorithm to the proof-of-stake algorithm. It could be one of the main reasons behind the high level of buying at the current moment.

At press time, Ethereum’s valuation remained under the $200 range at $195 but it could soon breach above the $200 once again. Its market capitalization remained under $22 billion with a trading volume of $18 billion over the past day.