US institutions account for 85% of Bitcoin buying in ‘very positive sign’ — Matrixport


Institutional investors are “not giving up on crypto,” with recent data indicating that as much as 85% of Bitcoin buying is the result of US institutional players, according to Matrixport’s chief strategist.

Markus Thielen, the financial services firm’s head of research and strategy, told Cointelegraph that the evidence shows that institutions are not “giving up on crypto” and is an indicator that we may be entering a new “crypto bull market now.”

The data was shared in a January 27 report by Matrixport, which suggests that one can tell whether a digital asset is more favored by retail or institutional investors at any given time based on whether that asset performs well in the US or Asia. business hours

The report stated that if an asset that trades 24 hours “does well” during US trading hours, it indicates that US institutions are buying it, while an asset that sees growth during Asian trading hours indicates that Asian retail investors are buying it.

The report cited that Bitcoin (BTC) is up 40% this year, with 35% of those returns occurring during US trading hours, meaning there is an “85% contribution” associated with US investors, indicating US institutions are buyers. of Bitcoin now.

Thielen added that preliminary data shows that institutions usually start buying Bitcoin first before investing in other cryptocurrencies. He noted:

“If history is any guide, then we should see the outperformance of tier 1 and altcoins relative to Bitcoin.”

While the report highlighted that news about other projects positively affected token prices such as Lido and Aptos, the crypto rally started only after the US inflation data was published on January 12.

It was also mentioned that Ethereum (ETH) seems to be doing well during US hours, indicating “institutional flows” into the cryptocurrency, however Aptos is doing well around the clock.

“Aptos sees a mix of strong returns during US trading hours AND during Asian trading hours.”

The report concluded by stating that this “should be a very positive sign for Bitcoin” as institutional adoption continues.

Related: Data shows that professional Bitcoin traders want to feel bullish, but the rally to $23K was not enough.

In earlier comments to Cointelegraph, economist Lyn Alden believes that Bitcoin is currently playing “a bit of catch-up”, returning to where it would have been without the FTX collapse.

Alden warned there was “considerable danger ahead” for the second half of 2023, citing liquidity conditions “good now” in part due to the US as a major factor.

Alden explained that as the US Treasury lowers its money 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 January 26 showing the price correlation between Bitcoin and Gold, stating that if Bitcoin continues to follow the price of Gold, it could even “crack the $50,000 mark.”