Investing In Bitcoin Mining Businesses Is Also A Sign Of Institutional Acceptance
24 July 2021 - 5:41PM
NEWSBTC
Last quarter, the New Jersey Pension Fund invested heavily in two
Bitcoin mining giants. A small step for institutional investors,
the move might represent something much bigger. There’s a hunger
for Bitcoin exposure at the highest levels, but just owning the
asset might be too risky or inconvenient for some of those big
players. And, until the US government approves the long-awaited
Bitcoin ETF, miners provide a much safer target. Related
Reading | Marathon Digital Holdings Reported A 17% Spike In Bitcoin
Mining According to Coindesk: The state-managed pension ended June
with $3.66 million in Riot Blockchain (NASDAQ: RIOT) and $3.39
million in Marathon Digital Holdings (NASDAQ: MARA), according to
disclosure documents. New Jersey’s Common Pension Fund D has $30
billion in total assets for state employees. The New Jersey Pension
Fund’s intent is clear, and they put their money where their mouth
is. However, is there a reason that explains why they don’t want to
hold the asset? A legal reason, perhaps? The polemic Michael Saylor
explains their rationale in this tweet: Many institutional
investors find publicly traded Bitcoin miners to be attractive
investments because they want BTC exposure but prefer to hold
securities rather than property due to tax, accounting, &
business considerations. So, there are several reasons besides
Bitcoin’s volatility. Nevertheless, there’s a hunger. RIOT price
chart on Nasdaq | Source: RIOT on TradingView.com Is Bitcoin
Feasible As An Institutional Investment? Bitcoin is maturing and
spreading. The title phrase is the same NewsBTC used three years
ago in an article that came to the conclusion that the asset wasn’t
ready. We said: In its current state, the market is highly
speculative, with a majority of investors looking to make a quick
buck. Institutional investors have seen that, and have mostly shied
away from opening their wallets for the industry. These investors
are looking for long-term returns, securing the trust of consumers
over time rather than making a quick buck. The tables turned. The
situation changed. At the present, we are in an era in which some
of the more innovative institutions already invested and drove the
price to insane all-time highs… only to take their earnings and let
it drop again. In any case, Bitcoin is proving its worth as
institutional investment. About this situation, NewsBTC said: These
high wealth players with decades of market experience and all kinds
of tactics on their side were paramount to driving prices up to
$60,000 per coin. Unfortunately, the data above suggests they were
also instrumental to the selloff that left retail traders with a
bloody aftermath. Related Reading | Brazil approves Bitcoin ETF –
SkyBridge files for its own What About a Bitcoin ETF? Is That In
The Cards? The only factor left unexplored is the possibility of a
Bitcoin ETF in the US. As you should know, every financial
institution and their mothers applied, and some of them have
already been rejected. NewsBTC quoted Hester Pierce, Securities and
Exchange Commission (SEC) Commissioner, who said about the
situation: (Institutions) want access to crypto through a regulated
market. It makes sense for us to consider how to do that (…). We’ve
dug ourselves into a little bit of a hole. A lot of people are
looking for a way to access the asset class. We waited a long time
to approve this kind of product. Sadly for us, we’re still waiting.
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