Analysts at JPMorgan shared that, “If pension funds and insurance companies in the US, euro area, UK and Japan allot 1% of assets to the most prominent cryptocurrency, Bitcoin (BTC), that would end in added BTC demand USD 600bn.”
These investors face regulatory roadblocks linking to risk levels and liability discrepancies, apparently restricting how much they can put into BTC, Bloomberg announced, quoting a note by the strategists.
As published last week, America’s Massachusetts Mutual Life Insurance (also known as MassMutual) has acquired USD 100m worth bitcoin to add to its general investment fund. MassMutual’s holdings are now 0.04% in BTC. The company also moved to catch a USD 5m minority equity stake in NYDIG. This Stone Ridge-run subsidiary firm presents crypto services to institutional investors.
Should the pension as stated earlier funds and insurance firms in the US, euro area, UK and Japan also allocate 0.04% of their assets to BTC, that would mean extra demand of USD 24bn? Today, BTC’s market capitalization is proximately USD 355bn.
As cited by the strategists at JPMorgan,
“One can see the potential demand that could arise over the coming years as other insurance companies and pension funds follow MassMutual’s example.”
Last Friday, the US-based business intelligence firm MicroStrategy confirmed that it raised USD 650m by selling senior convertible notes due 2025 to buy more BTC.
After a rally last Sunday, BTC trades at USD 19,111 (05:14 UTC) and is higher by 1% in a day, trimming its weekly losses to less than 1%. The price rallied by 18% in a month and 169% in a year.
No Comment