The surge in the cryptocurrency has attracted interest from well-known institutional buyers. The recent buy was necessitated by the continuous rise in the value of Bitcoin as an asset. Just some days ago from MassMutual’s $100 million investment in the currency, Ruffer was followed suit to enjoy the benefit of a booming industry.
MicroStrategy is also a notable investor with an impressive Bitcoin holding in the space. The business intelligence firm has been consistently investing in crypto even before the new all-new high. The London-based investment company has decided to add the digital asset into part of its investment with their latest 550 million pounds or $744 million buy.
Ruffer executives place bets in anticipation of Bitcoin surge
The executives have been studying the cryptocurrency, and the recent surge complemented their study. The board believes that the cryptocurrency would soon skyrocket in value; hence their latest decision of pumping millions into the digital asset.
Presently, the investment company has a large amount of money under its management. Based on reports, the firm has close to $30 billion under management and thousands of clients using their services. The company claimed the bet was headed by another firm and is worth only 3% of its portfolio.
Concerning the latest decision, Ruffed explained that the bet was a hedge to risks a weak monetary system is vulnerable to. Interestingly, the digital asset is currently used as a hedge to reduce the risk or exposure to other assets. Also, when the asset gains, it is an added advantage to the investor.
Concerning talks about rapid inflation these days, people have criticized the monetary policies of the Feds and advised the reduction of printing of paper money to control the inflation rate. In recent times, the dollar has been suffering from unexpected inflation which has made vast amounts of money flow into the crypto space.
How crypto serves as a hedge in the economy
Countries are experiencing numerous economic crisis, mainly due to the global pandemic that has reduced the economic activities of some firms in a bid to curb the COVID-19. Unfortunately, the reduction has caused instability in the local currency, where economies are still trying to regain stability.
Following the economic problems, people have run to diverse investments to act as a store of value for their funds. Bitcoin and other altcoins are recent choices of investors, primarily because of their scarcity and regulated production.
Bitcoin has been a way people still keep their monies safe despite the uncontrollable circumstances the economy has put so many people into. Bitcoin is no longer seen as just a bubble or a speculative asset, but an asset that outperforms the ancient yellow metal even in the harsh economic realities.
People are reducing their gold exposures to get a taste of the world’s largest cryptocurrency, especially when it is performing exceptionally well. The entry of institutional investors had also made the currency attractive in usage, unlike before when purchase was limited due to fear of its volatility. Even large institutions are following in the line of this blockchain technology, infusing it in their various platforms.