The world’s largest digital currency asset manager, Grayscale, says institutions are now looking to crypto as a potential hedge against global economic instability.
On a new episode of the Coinscrum markets podcast, Rayhaneh Sharif-Askary, Grayscale’s director of investor relations and business development, reveals that average weekly investments in the firm’s crypto trusts have increased more than 800% this year.
Sharif-Askary says Covid-19 has played a significant role in boosting the Bitcoin narrative.
“Covid-19 and policy implications have set the stage for Bitcoin to be seen as a store of value asset. Institutional investors are taking active long positions in digital assets through our products.
It’s because they’re looking for an asset that is scarce that can be used as an inflation hedge in a world where we are presented with unprecedented monetary stimulus.”
In the first quarter of this year, Grayscale raised half a billion dollars across all of its products. Investors poured $390 million into the Grayscale Bitcoin Trust and $110 million into the Grayscale Ethereum Trust.
Originally, individuals were drawn to Grayscale’s products to get exposure through tax-advantaged retirement accounts. However, the firm says 90% of fund inflows are now through institutional investors.
Traditional hedge funds represent the majority of Grayscale’s institutional investors. Sharif-Askary says 44% of fund inflows came from multi-strategy funds and a significant portion also came from long/short equity funds.