VanEck, a US asset manager, has released a report highlighting the growing adoption of Bitcoin by banks, countries, and ETFs. The report reveals that these big players currently hold $175 billion worth of Bitcoins, with ETFs alone accounting for $75.4 billion.
The report aims to educate VanEck’s investors about Bitcoin and its significant evolution over the years. It discloses the increasing institutional interest in the asset, with ETFs, countries, and public and private companies holding a substantial amount of Bitcoins.
According to a chart in the report, ETFs hold $75.4 billion, while countries, public companies, and private companies hold $40.7 billion, $22.3 billion, and $37.8 billion, respectively. Additionally, these big players collectively hold 15% of the total circulating supply of Bitcoin.
The report also discusses the overall growth of the Bitcoin ecosystem and highlights the potential of Layer-2 solutions to further boost adoption. It emphasizes the importance of the RGB protocol in the development of the crypto ecosystem.
One notable upcoming development in the Bitcoin network is RGB, which enables the creation and management of digital assets on top of the blockchain. This allows for the issuance and trading of various assets, such as stocks, bonds, real estate, and even other cryptocurrencies, on the Bitcoin network.
The report also acknowledges the initial challenges faced by Bitcoin, with only a small group of tech enthusiasts using it and a limited number of merchants accepting it as payment. However, the acceptance rate has significantly increased over time, thanks to the introduction of user-friendly wallets, exchanges, and marketplaces that have reduced the technical barriers.
Furthermore, institutional investors have shown a growing interest in Bitcoin. Hedge funds, asset management firms, and endowments are recognizing its potential as a store of value and a portfolio diversifier, particularly when considering its uncorrelated nature and ability to hedge against inflation.
The report also highlights Bitcoin’s role as a hedge against inflation, especially during the COVID-19 pandemic when widespread inflation eroded the purchasing power of fiat currencies. Unlike fiat, Bitcoin has a fixed supply, and its growth rate decreases by 50% approximately every four years due to halving events. This makes Bitcoin an attractive option for investors concerned about the impact of inflation on their portfolios and purchasing power.
In conclusion, VanEck’s report showcases the growing adoption of Bitcoin by major players in the financial industry and highlights its potential as a store of value, portfolio diversifier, and hedge against inflation.