Institutional investors “are not giving up on cryptocurrency,” with recent data pointing to as much as 85% of Bitcoin purchases being the result of US institutional players, according to Matrixport’s chief strategist.
Markus Thielen, head of research and strategy at the financial services firm, told Cointelegraph that the evidence shows that institutions are not “giving up on cryptocurrency” and is an indicator that we may be entering a new “bull market for crypto.” cryptocurrencies now.”
The data was shared in a Jan. 27 report by Matrixport, which suggests that you can tell whether a digital asset is more favorable to retail or institutional investors at any given time based on whether that asset is performing well in the United States. United or Asia. business hours.
The report stated that if an asset that trades 24 hours “performs well” during US business hours, it indicates that US institutions are buying it, whereas an asset that experiences growth during Asian business hours indicates that Asian retail investors are buying it.
The report cites that Bitcoin (BTC) is up 40% this year, with 35% of those returns occurring during US business hours, meaning there is an “85% contribution” associated with US-based Bitcoin investors right now.
Bitcoin Fear and Greed Index is 55 – Greed
Current price: $23,033 pic.twitter.com/OAt0TakkZR— Bitcoin Fear and Greed Index (@BitcoinFear) January 27, 2023
Thielen added that previous data shows that institutions generally start buying Bitcoin before investing in other cryptocurrencies. He noticed:
“If history is any guide, then we should see layer 1 and altcoins outperform relative to Bitcoin.”
While the report highlighted that news about other projects positively impacted token prices, such as Lido DAO (LDO) and Aptos (APT), the crypto rally only started once US inflation data was released. on January 12.
It was also mentioned that Ether (ETH) seems to be working fine during US time, indicating “institutional flows” in the cryptocurrency, however APT is working fine 24/7.
“Aptos is seeing a mix of strong returns during US business hours and during Asian business hours.”
The report concluded that this “should be a very positive sign for Bitcoin” as institutional adoption continues.
Related: Data shows professional Bitcoin traders want to feel bullish, but rally to $23K wasn’t enough
In earlier comments to Cointelegraph, economist Lyn Alden believes that Bitcoin is currently playing “a bit of a catch up,” getting back to where it would have been without the FTX crash happening.
Alden warned that there is “considerable danger ahead” for the second half of 2023, citing that liquidity conditions are “good right now” in part because the United States is an important factor.
#Bitcoin it is a masterpiece. pic.twitter.com/2rhnCYlkW1
—Michael Saylor⚡️ (@saylor) January 25, 2023
Alden explained that as the US Treasury is reducing its cash balance to keep the country’s debt levels low, it pushes “liquidity into the financial system.”
Meanwhile, popular trader and market commentator TechDev posted a Twitter update on Jan. 26 showing the price correlation between Bitcoin and gold, stating that if Bitcoin continues to follow the price of gold, it could even “break the gold mark.” $50,000″.
