Bitcoin goes mainstream as institutional 'wall of money' begins buying

In a moment of deliverance for cryptocurrencies, institutional investors are turning to Bitcoin as a hedge against fiat currencies that are losing value.

The world’s preeminent cryptocurrency is on track to hit US$1 million (A$1.4 million) per coin in the next five years as a result of a wall of institutional money looking to tap into Bitcoin appreciation – that’s the verdict from former Goldman Sachs hedge fund manager Raoul Pal, the man who founded financial news platform Real Vision.

Bitcoin prices have quickly grown from around US$13 (A$12) per coin in late 2012 to as high as US$20,000 (A$25,000) in 2017, before collapsing to as low as US$3,000 (A$4,500) in 2019.

The volatile gyrations have led many market participants to declare the cryptocurrency as an unsuitable asset and far too risky to be considered as a significant long-term investment.

However, things are quickly changing with institutional fund managers seeing Bitcoin in a completely different light.

Bitcoin allure

According to Mr Pal, heavy-hitting institutional investors are now eyeing up Bitcoin as a serious vehicle for long-term investment and portfolio allocation.

Earlier this month, Mr Pal revealed Bitcoin holdings in his portfolio were now “above 50%”, having previously been equally distributed between United States dollars, gold, equities, and Bitcoin.

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