Institutional investors are rushing to invest in bitcoin (BTC), according to Katie Wood, the head of the ARK Invest investment fund, since it has no connection of returns with other assets such as currencies, stocks, commodities, or bonds. She admitted this to Barron’s journalists in the United States.
According to Wood, research demonstrates that, in the face of the low correlation of returns among different asset groupings, acquiring the least similar asset to others can boost returns and lower investment risks. Moreover, because bitcoin has no analogs in the traditional financial world, it has piqued the interest of several significant institutional investors.
Despite the upbeat outlook, Wood said that the purchase of BTC by Tesla, the electric car company, caught her off guard. This occurred considerably sooner than anticipated. After conducting their study on bitcoin, ARK Invest‘s management predicted that firms would not begin diversifying their balance sheet assets into bitcoins anytime soon.
Katie Wood confirmed her prediction for a surge in the price of bitcoins, given how rapidly this trend presented itself. She believes that BTC will eventually reach a value of $ 500,000. This statistic is accurate. An increase in the presence of institutional investors will help it flourish in the market.
According to the ARK Invest fund’s analysts, if Bitcoin achieves widespread acceptability among major portfolio holders in the future years and commits 5% of their capital to BTC purchases, the cryptocurrency will easily surpass the half-million mark in value.
“Looking at the analytics on the web, you can tell that this is already happening,” – said Wood.