Institutional bitcoin investors are in for halving fever

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Renaissance Technologies’ Medallion Foundation Starts Trading Bitcoin Futures.
The size of the assets under the management of the company is about $ 75 billion.
Medallion fund has risen in price by almost 25% since the beginning of the year.

International consortium of news organizations developing transparency standards.

The tension on the eve of the upcoming halving in the bitcoin network is growing. It looks like this fever has reached institutional investors.

On May 12, an important and widely expected event will take place on the Bitcoin network – halving Bitcoin halving halving the number of new coins created and earned by miners in half. It happens about every four years and … More. The heat is steadily growing, and the Bitcoin fever has begun to engulf even traditionally cautious institutional investors.

Recently, the Medallion hedge fund, owned by Renaissance Technologies, has shown interest in cryptocurrency. [Financial Times] This heavyweight manages assets worth about $ 75 billion.

More signs of institutional involvement in #bitcoin. We are seeing more sophisticated players embrace this new asset class as #bitcoin continues its #QuantitativeHardening

Flagship Renaissance fund dabbles with bitcoin https://t.co/N320QtHsof via @financialtimes

– Brrrian Kelly (@BKBrianKelly) April 18, 2020

Model fund

The hedge fund, which is one of the largest funds in the world, has now received permission from the US regulator to trade bitcoin futures (BTC). According to Renaissance, the fund intends to restrict such trading to the Chicago Mercantile Exchange (CME)..

The company has already warned its clients that such futures contracts are a “new and highly speculative asset” associated with a whole range of risk factors – from “short history” to extreme volatility and vulnerability to various fraudulent schemes..

It should be noted that Medallion is a high-yielding hedge fund, whose value has grown by almost 25% since the beginning of this year, according to The Wall Street Journal. It is noteworthy that the main growth occurred in March, when other financial markets mostly suffered losses..

Moreover, in the 20 years since its launch in 1988, the fund has had an average annual return of almost 40%. [Institutional Investor] Perhaps the news that such a successful and respected fund has decided to go into cryptocurrencies will attract other hedge funds to bitcoin.

Recently, the editorial staff of BeInCrypto already talked about the cryptocurrency-oriented fund Grayscale Investments, which published a report on investments in digital assets for the 1st quarter of 2020. As the statistics showed, the inflow of institutional investors set an absolute record during the reporting period. It is also noteworthy that it was they (and, in particular, hedge funds) that formed the lion’s share of all investments (88%).

Data on the involvement of hedge funds in the crypto space and indicators of their profitability can also be obtained using the resource HedgeFundResearch.com.

Institutional bitcoin investors are in for halving fever

Why Bitcoin? Why now?

The most obvious answer to these questions is an early halving, which will lead to a reduction in the emission of new BTC and make bitcoin a more scarce asset. For this reason, each new halving is mainly associated with the expected growth in the MTC exchange rate..

The Problem With The 2021 Bitcoin Bubble

Unfortunately, this time the “purity” of this event is distorted by the consequences of the hardest crisis provoked by the COVID-19 pandemic. It is possible that this time many retail investors will have no time for investing in cryptocurrencies..

However, there is another side to this coin. Trying to keep the economy afloat, the authorities of various countries are carrying out an unprecedented injection of liquidity into their financial systems. Against the backdrop of this rampant “quantitative easing”, Bitcoin halving offers an alternative – “quantitative tightening”.

the "quantitative hardening" meme origin https://t.co/lXbFY2HDPk

– Adam Back (@ adam3us) April 9, 2020

This was recently recalled by Adam Back, co-founder and head of Blockstream.com, stressing that the cuts in bitcoin emissions increase its attractiveness as a “hard currency”, while traditional fiat is sinking deeper into the bottomless abyss of “quantitative easing”.

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