More than $750 billion has been added to the total crypto market cap since the start of 2020, but according to Barry Silbert, founder of Grayscale Investments, says a lot more is on the way.
According to the CEO of Digital Currency Group, a “tidal wave of capital is about to flow into crypto.” Here are the factors that could cause another surge of record-breaking inflows into Bitcoin and altcoins.
The Recent And Rapid Rise of Bitcoin
The total cryptocurrency market cap tapped more than $1 trillion in 2021, but it is possibly only the beginning of what’s to come.
Last year was underscored by the pandemic, and the unique environment it created was a perfect storm for Bitcoin to rise. A non-sovereign asset outside of the government’s reach, that is hard-coded to be digitally scarce, is incredibly attractive to the wealthy during a time when fiat money is being devalued at alarming rates.
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Trillions of dollars have been added in freshly printed USD, causing fears of hyperinflation. The price of commodities, stocks, and just about everything else has risen since – cryptocurrencies included.
Nearly a trillion of capital has come into crypto as a result, but according to industry pioneer Barry Silbert, a “tidal wave” is coming.
The total cryptocurrency market cap recently tapped $1 trillion, but more capital is coming | Source: CRYPTOCAP-TOTAL on TradgingView.com
Barry Silbert: “A Tidal Wave Of Capital” Is Coming To Crypto
Barry Silbert is in the know. He is the founder of Digital Currency Group, parent company of Grayscale Investments – the institutional investment platform of choice for Bitcoin exposure.
Grayscale is buying more BTC than miners can produce in the same timeframe, feverishly trying to meet demand. The demand Silbert sees must only be growing, ready for the flood gates to be opened.
As for what might be the key to turning the trickle of dollars into a flood, it could be coming from the stock market. All assets are currently in a bubble, but few classes are more overvalued than stocks.
The situation is coming to a head as retail investors face off against hedge funds and regulators, and it could only add to Bitcoin and crypto’s perfect storm.
Institutional investors could consider moving capital into crypto due to the larger chance of upside, or potentially to hedge against fiat monetary risk. Retail investors who have driven the post-Black Thursday bull market, have suddenly been betrayed by Robinhood, who has halted trading of GameStop, AMC, and other shares of dying or defunct businesses.
These traders could find a home in the “free market” of cryptocurrencies. The term is currently trending on Twitter, showing how significant this moment is to the history of finance.
Could the preference for truly free markets be the most attractive aspect of crypto yet? And could that be enough to cause the tidal wave Silbert speaks of? Time will soon tell.
Featured image from Deposit Photos, Charts from TradingView.com