Grayscale Investments released its detailed Q2 2020 digital asset report and noted that approximately 84% of its investment came from institutional investors.
According to the report, the company recorded $905.8 million total investment into Grayscale products during the second quarter of the year.
“Grayscale recorded its largest quarterly inflows, $905.8 million in 2Q20, nearly double the previous quarterly high of $503.7 million in 1Q20. For the first time, inflows into Grayscale products over a 6-month period crossed the $1 billion thresholds, demonstrating sustained demand for digital asset exposure despite a backdrop characterized by economic uncertainty,” Grayscale noted in the report.
Other notable highlights included $69.7 million that was recorded on Average Weekly Investment during the same period. In addition, its Average Weekly Investment at Grayscale Bitcoin Trust was $57.8 million. For the Grayscale Ethereum Trust, its Average Weekly Investment for that period was $10.4 million.
According to the report, the company noted that approximately 84% of its investment came from institutional investors. Notably, the hedge fund managers led in the investment, indicating a shift from traditional stocks preference to digital assets that are more volatile.
High volatility in the crypto industry has been a huge attraction to investors willing to take on the risk involved. “Cumulative investment across the Grayscale family of products since inception has reached $2.6 billion. Grayscale Bitcoin Trust and Grayscale Ethereum Trust both experienced record quarterly inflows of $751.1 million and $135.2 million, respectively,” it explained.
Grayscale Investments and Crypto Market
Grayscale Investments is the sponsor of Grayscale Bitcoin Trust (BTC), Grayscale Bitcoin Cash Trust (BCH), Grayscale Ethereum Trust (ETH), Grayscale Ethereum Classic Trust (ETC), Grayscale Horizen Trust (ZEN), Grayscale Litecoin Trust (LTC), Grayscale Stellar Lumens Trust (XLM), Grayscale XRP Trust (XRP) and Grayscale Zcash Trust (ZEC), and the manager of Grayscale Digital Large Cap Fund LLC.
This makes it a major player in the crypto industry especially relating to institutional investors who are flocking into the digital asset market at an incredible rate.
Different from the 2017/2108 crypto bubble that was largely affected by retailers hype, it’s anticipated that a new wave will erupt fueled by more favorable fundamentals, institutional players, and increased crypto awareness in the retail traders.
This was noted by Grayscale which recorded an influx in new investors. “In 2Q20, new investors accounted for $124.1 million of inflows and 57% of the investor base. Additionally, 81% of returning institutional investors in 2Q20 have now allocated to multiple products, an increase from T12M of 71%,” the report noted.