The co-founder and chief investment officer of cryptocurrency investment firm BlockTower Capital, Ari Paul, has argued that institutions don’t buy Bitcoin to make large amounts of wealth, but instead buy BTC to protect their assets.
In one SALT Talks Interview with John Darsie, first discovered by Daily HodlPaul argued that investors are taking a defensive approach when investing in the nascent cryptocurrency space to stay rich. He said: “We’ve spoken to a lot of billionaires in the financial world. It’s such an interesting change in mindset. They think defensively now. They think enough of their fellow billionaires who have 10% of their net worth in Bitcoin.”
According to Paul’s words, they think if they don’t invest in BTC and the cryptocurrency continues to rise, they won’t be “in that rich club” or “invited to parties” depending on where they are in the hierarchy.
This, he said, sees them thinking they need to passively allocate funds for the cryptocurrency space “just to keep up”. He added that it is not about getting rich, but about staying rich. BlockTower’s CIO added that high net worth investors are entering the market.
He cited data showing that Bitcoin is pulling away from cryptocurrency exchanges, indicating “massive institutional purchases”. It is believed that large movements from the stock exchanges are the result of over-the-counter trades by institutional investors. As FortuneZ reported, $ 1.7 billion worth of outflows from Coinbase indicated institutes continued to buy as the price of BTC surged above $ 30,000. The price hit a new high near $ 42,000.
Paul added that institutional investors will help reduce Bitcoin’s known volatility. Because these investors “want to buy more on dops” and “won’t sell with a trend reversal”. Although he has admitted that Bitcoin’s volatility will not go away, it will gradually decrease.