In 2020, Forbes awarded the title of "Person of the Year" in the cryptocurrency market to Michael Saylor, the CEO of Microstrategy. According to the publication, Sailor became the forerunner and popularizer of the era of direct institutional investment in Bitcoin.
At the end of September 2020, Microstrategy disclosed information about the purchase of Bitcoin for $475 million. The transactions took place when BTC price was about $11000 and attracted the attention of the public. Then analysts were waiting for the fall in the fall, but the cryptocurrency "went up".
In November, Bitcoin updated the maximum of $20,000, and when the rate approached $30,000, Michael Saylor issued bonds and with the proceeds of $650 million bought BTC at the highs of the market. The company, worth $917 million, managed to invest $1.125 billion in Bitcoin, which turned into 3.3 billion in a month and a half.
None of the institutional investors before Microstrategy bought cryptocurrency directly to avoid troubles with the Regulator. The Corporation acquired shares of investment funds, secured by real assets, albeit digital.
This form of investment has received permission from the US Securities Commission (SEC). The largest player in this area was the Grayscale Foundation, which received such a license in 2017. The company opened its first Bitcoin Trust (GBTC) in 2013. Currently, investments are accepted by 9 trusts, each of which was focused on a specific type of digital asset.
The fund's clients are professional investors who are ready to "freeze" at least $25 thousand of investments in a cryptoshare for a year, and they have contributed $600 million during 2019. At the end of 2020, institutions invested $20 billion in cryptocurrencies through Grayscale. The first six weeks brought the trusts another $ 10 billion in institutional investment.
Despite the high profits of Grayscale trusts in early 2021, the company may lose its monopoly on institutional funds, under the onslaught of high demand for cryptocurrency from corporations. Now the largest financial funds have appeared in this direction, with an established base of institutional clients, which previously avoided the topic of digital assets.
The SkyBridge Capital global investment company raised $310 million in January by launching a Bitcoin fund, the Ninepoint Partners LP management company sold BTC-backed shares in an IPO, getting $180 million for the package, the BlackRock financial corporation opened the possibility for customers to buy Bitcoin and Ethereum futures.
Major cryptocurrency investment centers have opened in Asia and Bermuda offshores. Investors in Thailand invested $50 million through the venture capital division of Siam Commercial Bank, the NASDAQ stock exchange co-founded the Hashdex Nasdaq Crypto Index mutual fund, whose shares can be freely and legally purchased in Bermuda.
The center of investment in cryptocurrency for Europeans is still Switzerland. There are 34 investment products linked to cryptocurrencies traded on the SIX Stock Exchange. Some of them are placed on the German Deutsche Börse, where only in the first month of January, an influx of crypto investments of 54 million euros was recorded.
Investments in the listed funds will not be the determining driver of the cryptocurrency market growth, judging by the reaction of traders to the Tesla report. Elon Musk Corporation acquired 7% of free Bitcoin funds in the fourth quarter of 2020, spending $1.5 billion.
The very fact of direct investment by Tesla led to new highs in the BTC exchange rate and the capitalization of cryptocurrencies, which soared by 200 million in a day. Now investors are waiting for similar steps from other key players in the technology sector.
Some of them (Twitter, Uber), publicly refused to invest in digital assets directly. The intrigue persists in the relationship between Apple and Facebook, and in the meantime, Microstrategy lectures and has released a free course for corporations that reveal the secrets of investments in Bitcoin.