According to recent data, institutional investors going long on Bitcoin (BTC) is on the rise since the beginning of October. However, it is still under levels seen in early September.
According to the Chicago Mercantile Exchange (CME) Bitcoin futures exchange, long positions are on the rise since the beginning of this month. The sustained, slow uptick is different than anything we have seen in the last few months.
The CME is a good measure of institutional interest, considering that it leads them all in trading volume. The data was compiled by Skew, which specified that its definitions of ‘institutions’ included the likes of pension funds, endowments, insurance companies, mutual funds, and investment managers.
However, as users have pointed out, it is still exceptionally hard for a pension fund or insurance company to invest in Bitcoin. Most of those going long right now is most likely hedge funds. Other ‘alternative’ asset managers are also part of the current institutional interest — but it remains quite limited, as @exchange_AS writes:
Very doubt that pension funds and insurance companies are holders of BTC futures. The regulations are not that simple preventing them from investing in even some traditional alternative assets, and here we talk about Bitcoin
Mostly they are HFs and alternative assets managers.
— as.exchange (@exchange_as) October 22, 2019
As of now, the amount of institutional money is limited by regulations alone. However, it seems that pension funds, in particular, are looking at the cryptocurrency industry quite closely.
In the beginning of this year, BeInCrypto reported that Morgan Creek Digital raised some $40M in investments, some of which was from pension funds — such as, for example, Fairfax County Police Officer’s Retirement System (with $1.45 billion under management) and County Employee’s Pension plan (with $4.25 under management).
In short, the slow uptick on Bitcoin longs by institutional investors on the CME is promising. However, one should keep things in perspective. Given the current regulatory atmosphere, many institutions simply cannot invest in Bitcoin — and changing this will take some time.
Do you believe that we will continue to see an uptick in Bitcoin longs by institutions until the end of 2019? Let us know your thoughts below in the comments.