Topic: Can Institutional Investors Bring in the Next Wave of Hype to the Crypto-Sphere? (Read 269 times)

Institutional investors will continue to invest as long as they see opportunity to make money. As long as Bitcoin has potential to gain value, they will keep buying.

How do you even know whether that’s true or not? They have been saying this since 2018 that we need institutional investors and they would be the ones to make the market grow, and till now I still haven’t seen any much changes and the last price movement upwards I wouldn’t say has anything to do with institutional investors.

I believe that guy is right. I have thought of the same thing, those institutional won’t even be buying bitcoins rather they will make use of platforms like Bakkt to be betting on it. Even those of them that gets interested in investing direct into Bitcoin will still be the same as the whales we already have, manipulating prices and ripping money off the market.

So this means they are no better than whales? It just feels to me that activities like this just drain money away from people. I think it can affect the popularity though but assuming people also enter the market the same way as these investors instead of buying bitcoins themselves, yeah, doesn't really do much good for adoption.

I have the attention span of a chipmunk, so I didn't read the whole article here but the above quote pretty much summarizes everything I skimmed through.

Those big institutional investors are nice and all, but they aren't actually buying cryptocurrencies as far as I know.  They have way too much money to actually buy bitcoin itself, so they have to bet on its price through options/futures on exchanges like Bakkt.  I don't think they're actually helping bitcoin's price, its adoption, or its popularity.  They just think of places like Bakkt as a big casino and while they'll make money for sure, I don't think they're benefiting crypto as a whole.

Yeah, I remember that as well.  Lots of hype around Bakkt's launch and there were quite a few threads with members speculating what the impact would be--and the first thing bitcoin did after it happened was to drop in value.  Quite a bit if I remember correctly.  And I don't even think Bakkt had anything to do with that, although there could have been some market manipulation happening. 

Ultimately I'm not sure if these institutional investors are as important to crypto as this article would suggest.

With the money coming in from the whales, we can have both rewards and risks that would put bitcoin to a whole new level. The reward is that, if you purchase 1+ billion dollars worth of bitcoin inside this year, you will increase the price a lot, even if people start selling more, the risk is that if you sell 1+ billion dollars worth of bitcoin you will cripple the market for a long time as well.

So, it is both good and bad, however one good thing that can't be risky is the fact that when companies go into bitcoin it becomes news and even if they end up selling, any news is good news for us since getting our name heard is the most important part of bitcoin world. Let's hope that people actually end up supporting the moves of institutional investors make and encourage them.

It is a little strange that a similar topic arose right now (once again). I remember that throughout the whole of 2018, everyone was waiting for when institutional investors finally came to the market.
Everyone was waiting for the opening of BAKKT and other gateways for the institutional. But when the discoveries took place, nothing happened.

Institutional investment coming comes in for one reason only - PROFIT. most institutions want to make sure that their portfolios are profitable for their rich clients and customers and making bank is what they are all about. Now is this a good or a bad thing you may ask? It depends on who they have trading for them in the markets. If they ar emaking a ton of profit shorting the markets through margin trading, then it's not that much beneficial for all the little retail investors and hodlers, but if they are building diverse portfolios and growing them for generational wealth and long term appreciation value for their clients, then it's a boon in disguise as it will be marketed to future generations that it will be normal and good to hold a percentage of their savings in a basket of cryptocurrencies.

They are kind of yes. Could be. But the name of Institutional Investors isn't all positive and all of that. They can also bring about negative results with their decisions. See, Libra coin indeed hyped the news of Crypto towards the world, but it also brought negative effects since the coin that let the world know that the crypto world isn't all fun and games, and that losses can be quite huge. We all acknowledge, and know of this, but in terms of BTC adoption, this kind of seems a setback of sorts.

Institutional investment is a dual edged sword, producing both tangible negatives and positives.

On the plus side, it has potential to legitimize the crypto sphere and catalyze mainstream adoption as OP's article mentions. It can boost consumer confidence despite lack of familiar brand name appeal. It could introduce additional competition to currency and investment markets, which will produce greater value to consumers over the long term. Undoubtedly there are many positives which will arise.

I think that people shouldn't forget however the student debt crisis arose as a byproduct of wallstreet owned and operated for profit colleges, approaching homeless people on the street and offering them government sponsored loans. There are negative trends associated with wallstreet factory farms. Negatives associated with wallstreet for profit prisons. Without going in depth, suffice it to say, its not all fun and games as far as institutional investment goes.

Hype they can definitely bring in, it's how much new money they can inject into the system that needs to be seen. One positive thing with this is that it brings in an air of legitimacy to the crypto industry, since these would be eventually regulated.

what i think about institutional investors is about how crypto-sphere will be more regulated,more rules,in the positive side crypto-sphere will be easy to be recognized by public, they will be have no worries anymore about crypto which full of scamming before. but on negative side, everything will be full with regulations by goverment and i hate that.
Because what they want is about long term investement, so to make that happen, everything like regulations etc. must be applied to prevent market crashes, momentary pumping dumping, liquidation, minimizing fluctuations etc.

It actually could. I have always been in the thinking that sometimes institutional investors are urgently needed for the people to follow. Institutional investors could play the role as herders or shepherds and the majority of the masses as the flock of sheep. If the big names such as Google, Microsoft, Amazon, Ebay, Apple, and others would announce that they are already accepting Bitcoin in their businesses, I am sure millions would immediately jump into the Bitcoin train.

If you were to talk about how Facebooks Libra influencing the rally, you could also say how investments made by institutional investors don't bring any assurance towards their investment. It is inevitable though, for decisions made by institutional investors to somehow influence the general populace, especially those who were just attracted by the news and decided to invest. With how advertisements work and all that.
But isn't that how Institutional investors affect the market? The community is swayed by the investors, and the market is swayed by the community. It all comes down to how the investors present the usefulness of their project to the community, as well as how famous they are in general.

Institutional investors are one of the key factors that could hype the crypto industry again. But due to lack regulations or clarity about the assets it will be difficult for them to get involve. I think crypto should mimic some of the regular stocks framework.

Institutional investing will drive the price up, reduce volatility, and it will make Bitcoin a more accepted investment.  I see it as a positive and something that is inevitable.

This is exactly what I was going to post, Institutional investors are
already playing with crypto as above.

The volatility is an issue for institutional investors in general, CME's allow
them to make "investments" without actually buying crypto. Some will see
the long term benefits too.

The Gemini exchange will add more investors also especially when
they know their investments are insured. Here is an interesting thread
about the recent move by the winklevoss twins > https://bitcointalk.org/index.php?topic=5218462.0;topicseen

The EU have also given a green light for Euro banks to get directly involved
in Bitcoin and crypto starting this year, here is a thread I started back in
November > https://bitcointalksearch.org/topic/m.53217178

More here > https://www.fxstreet.com/cryptocurrencies/news/new-eu-law-states-that-banks-may-hold-and-sell-bitcoin-from-2020-201912030544

We have reached to a point where going from 8k to 80k will require so much money that regular people can't provide that at all. I understand back in the day when we reached from 100 dollars to 1000 dollars was easy and we have managed it but there is a HUGE difference between taking the price from 100 to 1k versus taking it from 8k to 80k, it requires billions of dollars going into the market.

So, institutional investors would make up that difference, regular people will still be involved and maybe even more of them would be involved and the price could reach to 20k or even 30k without whales help but in the end in order to take the next step we will need billions of dollars from the big companies to go into the market all together to create some sort of hype and take it to next level for sure.

I don't think that "hype" is something that institutional investors would be able to bring once the majority of them are involved in the market, here's my point of view about it. Hype in the market we have is something that can't be played every time it is rolled out in the news, it gets worn out and it becomes less effective every time they recycle it in the news. One perfect example for this one is when BAKKT officially launch the market literally didn't react about it. Before that the hype for BAKKT on finally having a big company supporting Bitcoin with their Derivatives, futures trading, and custodian services it was overhyped by a lot of people especially the crypto news website that when it officially launch the price of Bitcoin neither go up or down. So imagine a news about institutional investors flocking the market officially or a more timely news about Bitcoin ETFs finally being available do you think it will create much hype as expected? I don't think so because the hype for them has or will die down before it ever happens. So if you are looking for the "next wave" to happen it won't really be because of the hype but because of the demand and money flowing in the market.

There is a significant different between how a real world company operates and how a crypto-based project works.

Company's model: The founders of the company dilute their control over company by selling the portion of the company to investors either by the way of shares or a fixed percentage. In either way, investors now have a control over company's decision making and they share the profits earned by company. On the other hand, founders get required money to operate company.

Crypto Project's model: The founders of the project sell self-created cryptocurrency to the investors. In order to create the value of cryptocurrency, founders inculcate the use case of cryptocurrency into the project. Mostly, the sole way investors can earn back their money is when the value of cryptocurrency soar. They have no control over project and don't participate in project's decision making.

Now the concept of institutional investors fits perfectly in company's model. Institutional investors being the group of experienced investors can shape any company from embryo stage to full-fledged functional enterprises. In return they are owning share of companies which don't have any use case. Thus, the value of shares will increase with the performance of company. The both motives are perfectly correlated.

But in case of crypto-project, both motives are disjoint. You can't guarantee that the success of project in operations will increase the value of cryptocurrency too since the value of cryptocurrency mostly move by demand/supply factors. Also if institutional investors take the majority of the supply of the cryptocurrency, there will be no market. A sea with single whale and no fish can't exist.

Crypto-projects should be community driven only then they could succeed.

Institutional investors and traders are already in the markets. It is just that only a few of the "sharks" from Wall Street have entered the market so far. CME and Bakkt have made the first steps towards creating a legal framework that would make the investors feel "safe" about their money. You won't see many institutional traders operating on exchanges like Bitmex or Binance that are not regulated and do not offer some kind of guarantee of the funds' safety.

Recently the Gemini exchange has announced the backing of their proprietary insurance company that would cover it with over $200M. The signs are there folks, institutions are slowly marching into the crypto sphere.