Traders are Fascinated by the Bitcoin Rollercoaster
Despite numerous soundbites from Wall Street CEOs, their underlings have remained conspicuously absent from the bitcoin debate. We know what Jamie Dimon and Lloyd Blankfein make of bitcoin, but what about the average institutional trader? Thanks to the efforts of Triad Securities, we now have an answer to that question. Between 6 and 13 November, they spoke to 317 institutional traders in a survey that reveals conflicting views on bitcoin.
When asked whether they had ever bought bitcoin or other cryptocurrencies, 31% said yes, with around half having done so only within the last six months. Another 36% professed to be considering buying bitcoin, 31% ruled it out altogether and, not surprisingly, just 1.5% of respondents confessed to being unfamiliar with bitcoin.
Bitcoin Good, ICOs Bad?
The same group of traders was also asked about ICOs, which received markedly less enthusiasm than bitcoin. The number of traders who had invested in them was less than 8%, and 48% stated that they hadn’t even looked at ICOs. 29% of those surveyed did admit to considering the merits of ICO investment, and another 15% expressed a desire for additional regulation before they would consider venturing into the space.
Last week, Coinbase announced that they were launching cryptocurrency asset management for institutional investors. The Triad Securities survey was conducted just before this story broke, so it is hard to say whether the news would have caused respondents to answer otherwise to the next question – What is your level of confidence in current bitcoin custodial offerings? As it was, just 9% claimed to have a high level of confidence, versus 26% having low confidence in the ability of Coinbase, Gemini, and others to safeguard digital assets.
Bitcoin Keeps Bubbling Nicely
The survey concludes by revealing a few tidbits of collective wisdom from the institutional traders involved. 41% see bitcoin as a safe store of value similar to gold and just over 39% think bitcoin is a bubble that’s destined to crash. Not all traders are as pessimistic about the currency’s prospects however: 27% think it will continue to rise gradually, and another 17% are bona fide bulls, asserting that bitcoin will double in value in the next six months.
For investors accustomed to enjoying single digit growth, bitcoin, with its explosive growth, is an asset whose rise can only be watched with a mixture of envy and apprehension. No one knows where bitcoin will be six months from now, but one thing’s for sure: Wall Street’s watching closely.