Bitcoin’s (BTC) remarkable climb to $93,000 is primarily driven by substantial institutional investors rather than retail ETF purchasers, as noted by Coinbase Institutional’s John D’Agostino on CNBC.
The surge started in early April when institutional players and sovereign wealth funds began accumulating BTC, characterized by “patient pools of capital,” while retail investors withdrew funds from spot ETFs.
“Institutions, sovereigns, patient pools of capital were piling in,” he emphasized. “Retail via the ETF were exiting. So you’ve got to ask yourself, what do the institutions know?”
“Institutional conviction is now being formalized.”
Earlier this week, a new Bitcoin investment company, Twenty One Capital, was launched by Strike CEO Jack Mallers and Cantor Fitzgerald’s Brandon Lutnick, backed by Tether, Bitfinex, and SoftBank, planning to trade publicly under the ticker “XXI” with over 42,000 BTC.
D’Agostino elaborates on three main reasons for this trend. Firstly, de-dollarization: institutions and sovereign entities are reducing their USD exposure as trade weakens. Secondly, there is a decoupling from technology: Bitcoin is shedding its association with Nvidia. Lastly, a hedge basket theory suggests Bitcoin ranks within the top five inflation hedge models favored by veteran commodity traders.
“Bitcoin is trading on its core characteristics, similar to gold. It has qualities like scarcity, immutability, and non-sovereign asset portability,” he continued.
Meanwhile, major altcoins like Ether (ETH), Solana (SOL), and Cardano (ADA) have not exhibited similar upward trends. According to the CoinDesk 20 (CD20), Bitcoin is up 7% over the last month, while the broader market has seen a downturn, down 3% in the same period.
This uptick in Bitcoin’s price might be rekindling retail interest in BTC ETFs. Data from SoSoValue shows ETF inflows exceeding $900 million for several consecutive days, totaling over $2.2 billion between April 21 and 23, despite recent net outflows from Bitcoin ETFs totaling approximately $1.21 billion.
