Tech researcher Kevin Rooke has tracked state-owned companies’ Bitcoin (BTC) holdings for the past two years. According to Rooke, state-owned companies now hold more than $ 3.6 billion in BTC.
In 2019, state-owned companies only had 20,000 BTC on their books. This figure rose to 105,837 BTC in 12 months. Recruit said:
“Last year, state-owned companies held less than 20,000 BTC on their balance sheets. Today, 19 state-owned companies hold 105,837 BTC on their balance sheets, valued at more than $ 3.6 billion. “
Today, MicroStrategy is the largest holder of Bitcoin with 70,784 BTC with GalaxyDigital Holdings a distant second with over 16,400 BTC. Square Inc., meanwhile, is the largest company by market capitalization among public company holders with around 4,700 BTC.
Why is the institutional demand for Bitcoin increasing?
In one year, SOEs alone accumulated around 85,000 BTC, which equates to $ 2.67 billion.
This trend is indicative of the rapidly growing institutional demand for Bitcoin, as evidenced by booming business activity in Grayscale and CME.
Grayscale’s products and CME Bitcoin’s futures market are both primarily aimed at institutions, and they have seen a massive increase in volume since mid-2020.
Institutions are increasing their exposure to Bitcoin due to expectations that BTC will eventually evolve into an established alternative to gold.
Amid rising inflation and cash injections from central banks, investors and businesses are looking for ways to hedge their assets and portfolios. Winklevoss said:
“Inflation robs you of the job of your life. The Argentine peso has lost 50% of its value against the US dollar over the past 3 years. And that says a lot given the current state of the US dollar. No wonder research interest in #Bitcoin is soaring. “
If the Biden administration aggressively introduces more stimulus and effort to ease financial conditions, it would likely create a more favorable environment for the Bitcoin and gold rally.
What analysts expect from BTC in the near term
For the foreseeable future, despite a convincing macroeconomic environment, analysts are slightly cautious.
Still, in the big picture, macro analysts say they lean towards the bullish scenario for Bitcoin. Alex Krüger, economist and Bitcoin trader, said:
“$ BTC is stuck in a range between 29K-35K. It can break anyway. Interest rates are the main reason I am bullish. The exuberance has flushed the system dramatically, as evidenced by the drop in rates. This is a bull market and traders are now bearish. It’s optimistic. “
More institutions are also expected to accumulate Bitcoin in the coming weeks, due to improving market sentiment.
On top of that, the derivatives market has reset as the futures market becomes less crowded. The trader further noted:
“Funding is flat or negative. Perpetuals are trading below the spot. The per-spot base has not been negative for so long since the pre-November election, and the annualized quarterly base has gone from 25% -28% a week ago to 7-10% now. All this sings of a good recovery. “