August is less than two weeks old, and it’s already become one of the most important months for cryptocurrency’s march towards acceptance as a mainstream investment.
The big news, needless to say, was business intelligence firm MicroStrategy’s Aug. 11 announcement that it had bought $250 million worth of bitcoins, pouring the entirety of its planned investment in alternative assets as an inflation hedge into the first cryptocurrency.
“Our investment in Bitcoin is part of our new capital allocation strategy, which seeks to maximize long-term value for our shareholders,” said Michael Saylor, CEO of MicroStrategy. “This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”
That led Barry Silbert, the CEO of Digital Currency Group, to comment, “MicroStrategy, a $1.2 billion company, just turned itself into a publicly traded bitcoin play. Smart.”
Silbert’s Aug. 11 tweet came on the heels of his own news. On Aug. 6, DCG-owned Grayscale Investments’ announced that it had filed to make its Grayscale Ethereum Trust its second U.S. Securities and Exchange Commission-reporting company. If approved, it would join the Grayscale Bitcoin Trust in that category—which it emphasized is not an exchange traded fund (ETF).
In its filing, Grayscale disclosed that it saw average weekly investments of $10.4 million in Q2 of this year, amounting to more $135 million. The Grayscale Ethereum Trust currently has $757 million in investments. The Grayscale Bitcoin Trust is currently at $4.7 billion, according to the company.
The decision was based on the growing willingness of institutional investors to look beyond Bitcoin, Grayscale told Cointelegraph.
BitGo CEO Mike Belshe said in a series of tweets on Aug. 12 that institutional investors are recognizing that the Fed’s printing of money and more money to support the cost of the coronavirus lockdown makes it time to look for alternatives to cash.
“They’re looking for alternatives, and it… comes down to Bitcoin and gold,” Belshe said across two tweets. “If you don’t have some Bitcoin now, it is time to put at least 3% of your net worth into Bitcoin. This is the lowest risk, highest asymmetric upside investment you will likely see in your lifetime.”
Gemini CEO Tyler Winklevoss was a little more expressive, following a tweet calling Bitcoin “the only long-term hedge to all the inflation that’s coming” with the rather grandiose prediction, “The Great Monetary Inflation is nigh.”
His advice? “Arm yourself with #Bitcoin.”