Crypto ETF Returns Soar As 2023 Begins With Institutional Price Optimism
As the first month of 2023 draws to a close, crypto-focused equity exchange-traded funds (ETFs) have delivered incredible returns for institutional-focused investors. Optimistic cryptocurrency situation and high-performing his ETF, also high net worth (HNW) individuals.
Wealth management advisory firm deVere has indicated that billionaires are seeking advice on adding assets like Bitcoin to their portfolios despite the difficult past 12 months. A survey conducted by deVere found that he 82% of high net worth individuals seek cryptocurrency advice.
January performance was strong across most of the cryptocurrency markets, but we have to remember that we still have a long way to go to reach the highs seen previously. However, macroeconomic shifts point to conditions that favor the “risk-on” assets that many institutional investors believe cryptocurrencies apply to.
Crypto ETF Offers Over 100% Gains In January
Leading institutional investors down the crypto-focused ETF route is the $3.9 million Valkyrie Bitcoin Miners ETF, which has returned 101% since January 1st. 80 percent profit.
The cryptocurrency market also rose, with Bitcoin growing nearly 40% since the end of last year. The major coin reached $23,000 and fell to nearly $16,000 towards the end of 2022. It should be remembered that this is still far from the all-time high of November 2021.
Other coins have also shown decent returns, up nearly 150% over the same period.
Those with more traditional, institutional backgrounds are looking to macroeconomic conditions for answers. There are signs that inflation may have peaked, especially in the US, paving the way for more ‘risk-on’ investment strategies.
Billionaire looking to buy bitcoin
Digging deeper into deVere’s research, eight out of 10 customers with investable assets between $1.23 million and $6.15 million were seeking advice on cryptocurrencies through 2022.
Nigel Green, CEO and Founder of deVere Group, commented on the situation last year.
“Prices fell as investors reduced their exposure to risk assets, including stocks and cryptocurrencies, due to growing concerns over inflation and slowing economic growth. But against the backdrop of this so-called ‘crypto winter’ , HNW has always sought the advice of financial advisors on the inclusion of digital currencies in its portfolio. ”
With a strong start to 2023 and strong returns for retail and institutional ETF users, there is no doubt that interest in HNWIs will increase. In addition, Wall Street giants and other companies that serve institutional investors have also started offering more crypto-related services.
on the flipside
- The general market conditions in the crypto space have a long road to recovery. Even though Bitcoin’s price is up nearly 40% of his, it doesn’t necessarily mean the end of the bear market.
- Blockchain, cryptography, and many companies involved in investing in this space need to improve under generally poor market conditions. Tech layoffs and the threat of a global recession following the pandemic still pose problems for riskier assets such as cryptocurrencies.
why you should care
A recovery in ETF and institutional interest in general will be driven by a recovery in the general cryptocurrency market. However, additional risk-on investments by institutional investors can still have a large impact in a relatively small market. Bitcoin’s November 2021 rally to all-time highs was heavily snowballed by an infusion of institutional investment.
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