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According to the recently launched cryptocurrency exchange Coinbase, corporate investors ranging from hedge funds to pension and insurance companies have piled into bitcoin in unprecedented numbers.
Since the start of the year, Coinbase has seen a 170% increase in the number of institutional investors building up in the currency.
After investing around $ 45 billion in institutional money through its platform in December, it now has $ 122 billion, the group said.
Bitcoin surged in value during the first quarter of the year, although it has since plunged.
Drew Robinson, Head of Hedge Fund Sales at Coinbases, said: Over the past 12 months, we’ve seen a growing interest from institutional investors looking to take advantage of the crypto space. However, this year interest on pension funds and hedge funds has skyrocketed.
He said the advent of crypto exchange traded products, which are derivatives that track the movements of cryptocurrencies, has increased demand.
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The institutions had cited reasons ranging from hedging against inflation, the diversification of corporate balance sheets and the desire for broader engagement in the digital economy. Clients of large investment funds had also asked them for more exposure, Robinson said.
Coinbase said it has more than 8,000 institutional customers.
The company is experimenting with chimes with survey data showing that institutional investors bought more than 132,000 bitcoins in the first quarter of 2021.
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