Bitcoin surged past $100 billion market cap for the first time since November 2018 after a combination of good news stories caused all the top cryptocurrencies to rise in price over the past 24 hours.
Most promising for crypto investors is the potential for institutional investment to inject fresh funds into crypto. Thanks to a survey from financial services giant Fidelity Investments, there’s strong reason to think it could come soon.
Fidelity, which began a Bitcoin custody service earlier this year and runs a digital assets division, ran a survey to find out how pensions, family offices, hedge funds, endowments and foundations feel about owning cryptocurrencies. According to the survey – which questioned 441 institutional investors from November to February – 47 percent of institutional investors said digital assets are worth investing in, and the same percentage said they appreciate crypto for being innovative.
Just as important, but not as widely reported, is the fact that 46 percent of respondents like the low correlation between cryptocurrencies and other asset classes. This proves that cryptocurrencies are the perfect hedge, and a good asset class to include in a diverse portfolio of investments.
Fidelity said it wants to change the fraud, theft and regulatory infractions that have tarnished the crypto market, and it’s up to the established financial services institutions (such as itself) to do this.
Adding to this news was an article in the Wall Street Journal detailing how Facebook is actively recruiting allies to support its under-construction cryptocurrency-based payments system. Internally dubbed ‘Project Libra’, the blockchain-powered initiative will reportedly feature a U.S. dollar-collateralised stablecoin. Visa and Mastercard are rumoured to be supporting the initiative and the Wall Street Journal even suggests Facebook might reward users with fractions of the stablecoin in exchange for viewing advertisements or even by simply using the social platform.
José Maria Macedo, Head of Advisory at AmaZix, commented on today’s news: “After a difficult year, price trends are indicating that the crypto winter is finally coming to an end. Interest in the crypto market is increasing again, with financial and tech businesses looking again at how they can implement crypto and blockchain into their models.
“Facebook’s move to integrate crypto into its payments system is the latest example of this and is yet another positive move which will bring crypto closer to a mainstream audience. I expect that this interest will continue for some time and more enterprises will begin to explore uses for crypto, as Bitcoin’s lack of correlation with other assets, and the macro demand for growth, will continue to drive institutional investment.
“From our point of view, we’ve seen a lot more demand for services around IEOs and STOs in recent weeks, as businesses explore how they can offer crypto services to their customers.”