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Many public companies are optimistic about Bitcoin as an investment due to the predetermined fundamentals.
2020 has been the year Bitcoin was ‘officially’ endorsed by many public companies and institutional investors led by Grayscale that had over $5.1 billion in Bitcoin at the time of reporting. According to Coin98 analytics, Grayscale dominance as a leading institutional investor is being challenged by other publicly traded companies that are seeking to acquire a share of the Bitcoin cake.
Bitcoin and Public Companies
Coin98 analytics reported that there were approximately 13 publicly traded companies that have invested in Bitcoin. Whereby, as of October 9, CoinShare had 69,730 Bitcoins in total investment. The third position was MicroStrategy that had 38,250 Bitcoin as part of its contingency plan.
The fourth position was Galaxy Digital with 16,551 Bitcoins. The rest were 3IQ Digital asset management with 8,295, BTCe with 5,215, Square with 4,709, HUT 8 with 2,954, Voyager with 1,239, IOT Blockchain with 1,053, Digital X with 215, CypherPunk Holdings with 204 Bitcoins, and Argo with 126 Bitcoins.
However, their total value is a drop in the Bitcoin market capitalization at the time of reporting, whereby it had a market capitalization of $211,018,614,156 and a daily trading volume of $20,357,834,710 according to CoinGecko. Bitcoin was trading at $11,395.56 having dropped approximately 0.1% in the past 24 hours.
However, the asset was up 36.6%, 7.0%, 5.9% and 6.9% in the last one year, the last 30 days, the past two weeks and in the past seven days respectively.
The Bigger Picture
Institutional investors are optimistic with Bitcoin as an investment due to the predetermined fundamentals. Bitcoin has a finite supply of 21 million, with its inflation mathematically controlled since its inception.
Additionally, its demand has been rising especially fueled by the failing fiat system. During the pandemic, most global economics have resulted in printing out money at a faster rate than before to offset the coronavirus market turmoil. Moreover, governments led by China are developing digital currency that will be interoperable with Bitcoin and other cryptocurrencies hence legitimizing Bitcoin’s authority.
Notably, institutional investors are also diversifying their crypto portfolio including Bitcoin Cash, Ethereum, XRP, Binance Coin, Litecoin and many more. It is said that since the crypto bubble is technically behind us, the token’s utility will derive its future value.
Different digital assets are solving market problems that Bitcoin as their mother coin falls short of. For example, XRP, which is the native coin in XRPL was developed to solve the speed and transaction cost that Bitcoin was falling short of. Additionally, Ethereum and its blockchain were developed to take advantage of smart contracts and enable decentralized apps that have brought about decentralized financial services alias the DeFi ecosystem.