Bitcoin has been on a rally and though it slowed down with a pullback in the last few days, it has bounced back quickly, currently priced at over $19,000. Though this looks impressive and investors are pleased with the price movement, the Managing Director of Grayscale, Michael Sonnenshein says the rally is still in its initial stage considering the ongoing inflow into the investment platform.
Speaking on CNBC’s Squawk Box, Sonnenshein said Bitcoin is just getting started despite its over 157% appreciation in 2020. He added that there is a growing interest not just in Bitcoin but also in the other investment products that Grayscale offers.
Grayscale has been leading with the accumulation of digital assets. The platform has bought more Ethereum and Bitcoin than any other company particularly in 2020. As of May, the company had bought more than the total number of Bitcoins mined since the year started. The net asset under management as of mid-November was $9.8 billion.
At the same time, Grayscale has been buying Ethereum massively. By the second quarter of 2020, the company had bought roughly 50% of all Ethereum mined in 2020. With the huge buying of Ethereum, the ETH under Grayscale management has grown to over $1 billion and more investors are still coming in according to Sonnenshein.
Interestingly, Grayscale is just a digital assets management platform that helps both individual and institutional investors to invest in digital currencies. There is also an increasing number of corporate investors who have entered the cryptocurrency space in 2020. Corporate investors now have no less than 500,000 BTC on their balance sheets in total which is great progress from the state of the industry before now.
Analysts expect that Bitcoin will break through 2017 all-time high and reach new heights in no time. It has also been predicted that 2021 may be a bigger year for digital assets than 2020. A Citibank executive earlier projected that Bitcoin could reach well over $300,000 by the end of 2021. With the rate of investors flocking to the industry and the strength of the current Bitcoin rally, it will be interesting to see if this comes to pass in 2021 and also to see what lies beyond.