New research1 with 50 institutional investors and 50 wealth managers across Europe, who collectively manage over $110 billion in assets, reveals that over the next two years 81% expect to see an increase in corporations using Bitcoin for their treasury reserves. Some 29% expect to see dramatic growth in this trend.
The survey was commissioned by Nickel Digital Asset Management (Nickel), the regulated and award-winning investment manager connecting traditional finance with the digital assets market.
Anatoly Crachilov, co-Founder and CEO of Nickel Digital, commented:“A growing number of corporations, including car manufacturer Tesla, business intelligence firm MicroStrategy, and mobile payments processor Square have recently made non-trivial, multi-billion allocations to Bitcoin as part of their treasury reserve strategies. This, coupled with announced structural allocations to crypto assets by the leading global asset managers, including Paul Tudor Jones, Bill Miller, Ruffer, and Guggenheim Partners is a huge endorsement for the Bitcoin emerging store of value functionality.
“The COVID-19 crisis and the expansionary monetary policies that have been implemented in response to this, has changed the outlook for fiat currencies, massively increasing the risk of currency debasement. Indeed, US M2 Money Supply has increased by 28% over the last 12 months, on the strongest pace in nearly 80 years, raising red flags for many managers and asset owners, entrusted with capital preservation.
“The recent poor performance of gold, the traditional safe haven, as well as $16 trillion worth of global bonds trading in negative yield territory has also encouraged many corporations to contemplate a revision to their treasury strategies. Bitcoin, a non-discretionary asset (i.e. without anyone’s ability to unilaterally inflate its monetary policy), with unique attributes of immutable and verifiable supply, predictable issuance schedule and deflationary characteristics make it an appealing asset allocation for many corporates and asset managers alike.”
Nickel’s survey found that 85% of professional investors interviewed who already have exposure to Bitcoin, said they plan to increase their investment in it over the next two years. The main reasons for this include an anticipated growth in its valuation, followed by its ability to provide a tail hedge against excess monetary supply and currency debasement, and that the size of the market has crossed minimum threshold for mainstream institutional investors to start allocating to this market.