Institutional investors continued to move onto the gray-scale product range in the fourth quarter, highlighting the continued urgency for Bitcoin (BTC) and Ethereum (ETH) exposure.
Total investments in the Grayscale family of products reached $ 3.3 billion in the last quarter of 2020, which translates to an average weekly inflow of $ 250.7 million, digital asset managers reported Thursday. That is three times that of the third quarter when gray-scale products earned $ 1.05 billion.
Grayscale’s Bitcoin Trust generated $ 217.1 million from average weekly inflows.Ethereum Trust had an average of $ 26.3 million in new investments.
Ninety-three percent of the new investments come from institutional investors, with asset managers accounting for the largest share, according to Grayscale.That̵7;s a nine percent increase from the third quarter when institutions accounted for 84 percent of new equity.
In 2020, investments in Grayscale products totaled $ 5.7 billion. That’s more than four times the cumulative influx between 2013 and 2019.
Grayscale’s data reflects Bitcoin’s tipping point in 2020 as smart money investors begin to view digital assets as a hedge against inflation and long-term value storage. The narrative helped propel Bitcoin to nearly $ 42,000 in early January after more than doubling in just three weeks.
Institutional adoption of Bitcoin puts assets on a path to maturity, according to Goldman Sachs CEO Jeff Currie.However, he admits that Bitcoin has a long way to go before it can be considered an institutional asset.
Bull markets may receive additional stimulus in the coming weeks as the incoming Biden administration will prepare a multi-trillion dollar stimulus package. A huge devaluation of the US dollar is driving more investors into Bitcoin.
Grayscale did not immediately respond to a request for comment.