U.S. investors have been piling into Bitcoin (BTC) as institutional activity accelerates, driving the recent rally of the largest cryptocurrency by market capitalization. According to crypto analytics firm K33 Research, BTC’s price gains and trading volume have concentrated during U.S. market hours recently, and have been the main force behind BTC’s 85% surge so far this year. This surge has come as a slew of financial heavyweights, including BlackRock, Fidelity, and Citadel, have become more involved with BTC, spurring investor optimism.
Open interest on the Chicago Mercantile Exchange (CME) futures market, a favored venue among sophisticated investment firms, has been nearing its all-time high, K33 data shows. Digital asset funds recorded $199 million of inflows last week, the largest in almost a year, with Bitcoin-focused funds enjoying 94% of all inflows, according to a report by asset management firm CoinShares.
Samir Kerbage, Chief Investment Officer at crypto asset management firm Hashdex, noted that this activity showcases an inflection point in crypto’s institutional adoption. We may be at a generational moment in time for individual crypto investors, he said. The current institutional interest we are witnessing is far from the opportunistic FOMO [fear of missing out] we have seen in the past that can push prices up in the short term. These institutions move slowly and deliberately and invest for the long term—once they are in, they are in.