US institutions account for 85% of Bitcoin buying in ‘very positive sign’ — Matrixport

Institutional investors are “not giving up on crypto,” with new data showing 85% of Bitcoin purchases are the result of American institutional players, according to strategists Matrixport.

Markus Thielen, head of research and strategy at the financial services company, told Cointelegraph the evidence shows that institutions are not “giving up on crypto” and is an indicator that we may be entering “the current crypto bull market.”

The data is shared in a January 27 report from Matrixport, which shows that it is possible to distinguish whether digital assets are preferred by retail or institutional investors at any given time based on whether the asset is doing well in the United States or Asia. trading hours.

The report said that assets that traded 24 hours “underperformed” during US trading hours, indicating that US institutions were buying, while assets that saw growth during Asian trading hours indicated that Asian retail investors were buying.

The report states that Bitcoin (BTC) is up 40% this year, with 35% of the return occurring during US trading hours, meaning that there is an “85% contribution” related to US-based investors, indicating that US institutions are the buyers. Bitcoin now.

Thielen added that previous data showed that institutions usually start buying Bitcoin before investing in other cryptocurrencies. He noted:

“If history is a guide, then we should see a higher performance of layer 1 and altcoins than Bitcoin.”

While the report highlighted that news about other projects had a positive impact on the price of tokens such as Lido and Aptos, the crypto rally only started after the US inflation data was released on January 12.

It was also mentioned that Ethereum (ETH) looked good during the US hours, indicating “institutional flows” into the cryptocurrency, but Aptos performed well during the hours.

“Aptos saw a strong mix of results during the US trading hours and during the Asian trading hours.”

The report concludes by stating that this “should be a very positive sign for Bitcoin” as institutional adoption continues.

related: Data shows Bitcoin pro traders want to feel bullish, but the rally to $23K is not enough

In previous comments for Cointelegraph, economist Lyn Alden believes that Bitcoin is playing a “bit of catch-up,” returning to where it would have been without the FTX collapse.

Alden warns that there is a “considerable danger” in the second half of 2023, saying that liquidity conditions are “right now good” because the US is the main factor.

Alden explained that when the US Treasury issues cash balances to keep the national debt level low, it pushes “liquidity into the financial system.”

Meanwhile, popular trader and market commentator TechDev posted a Twitter update on January 26 showing the price correlation between Bitcoin and Gold, stating that if Bitcoin continues to follow the price of Gold, it may “crack the $50,000 mark.”