Coinbase officially announced the acquisition of Xapo’s institutional custody business earlier today, CEO Brian Armstrong took the opportunity to share the bullish update with the crypto community.

Shortly after sending out the word on the big strategic move, Armstrong took to Twitter to claim that the decentralized digital economy was taking in around $200-400 million in institutional investments every week.

Coinbase Capital Worth $1 Billion or More Each Month?

Although he didn’t name any particular asset, Armstrong’s tweet essentially meant that the demand for Bitcoin is currently skyrocketing. After all, Bitcoin has long been the digital currency of choice for the vast majority of institutional investors.

Now, being an industry insider, as well as the head of one of the world’s largest cryptocurrency exchanges, Armstrong’s words carry a great deal of weight. To that effect, it is tempting to argue that his previous Tweet packed enough punch to single-handedly ignite a new price rally for Bitcoin.

Given the high stakes involved, it was only a matter of time until the question was raised as to why the numbers cited by Armstrong haven’t yet been heard from any other credible sources.

Note that a quick Google search didn’t return any positive matches, aside from those quoting Armstrong on said figures. So, does that mean Armstrong implied Coinbase alone was receiving $200-400 million per week from institutional investors? That translates into roughly $1 billion or even more over the course of a single month.

Details Need Clarifying

Could it be that Armstrong was actually referring to institutional money that was already in the crypto space, but was recently moved over to Coinbase Custody?

It’s possible but unlikely given that he specifically mentioned new deposits in his tweet.

While $200-400M is definitely a hefty amount, it’s not beyond the realm of possibility for Coinbase Custody to attract such high volumes of capital given its position up there at the top of the crypto-custodian hierarchy.

Besides, we have to also consider the fact that there has been a resurgence of institutional interest in the cryptocurrency space over the past few months — a trend that was evident from New York-based crypto-fund manager Grayscale’s financial report for Q2 2019.

During the second quarter ending on June 30, Grayscale’s assets under management grew almost three-fold to $2.7 billion as compared to $926 million in the previous quarter. The company attributed the growth to the end of the proverbial crypto-winter and added that institutional investors accounted for 84% of all demands during that period — up 9% as compared to the corresponding figure from Q1.

We were not yet able to independently verify if Coinbase is actually taking in over $1 billion a month from institutional investors, but we are digging for more info. Let us know any comments or leads in the comments below.

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Images are courtesy of Twitter, Shutterstock.

Shilpa Lama

Shilpa is a network engineer and management graduate who is deeply passionate about artificial intelligence and blockchain technology. She has been associated with several leading science & tech publications throughout her career as a journalist and columnist. Full-time foodie, semi-skilled musician, wannabe novelist.

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