Institutional cryptocurrency lender Genesis Capital, which manages crypto funds for family offices and high net worth clients, has recently revealed it’s seen institutional counterparty volumes rise “two to three times” over the past 12 months, as bitcoin moves closer to its near $20,000 all-time high.
According to a report by CNBC’s Seema Mody, the flagship cryptocurrency’s rise so far this year may, in part, be attributed to the uptick in institutional activity. Bitcoin hit a low of $3,200 in December of last year and has been rising since then, breaching the $12,800 mark earlier today.
Mody’s report noted that while Facebook’s new cryptocurrency Libra may be supporting BTC’s price rise, the cryptocurrency was already up 140% this year before the social media giant announced its cryptocurrency, which is designed to be a means of payment for international money transfers.
CNBC also noted that some analysts believe bitcoin hasn’t been rising thanks to Libra, but because of geopolitical tensions ranging from instability in countries like Turkey to the US-China trade war and recent exchanges between the US and Iran.
As for a potential correlation between BTC and gold, Mody noted a portfolio manager told her it’s “less about the correlation and more about investors trying to diversify smaller parts of their portfolio into other assets.”
The report added an event to watch will be the U.S. House Financial Services Committee hearing on Facebook’s Libra, which is set to take place next month. It didn’t mention several other factors that could be behind BTC’s rise, however.
As CryptoGlobe covered, Binance recently announced a U.S.-only trading platform, which will likely not list all of the altcoins the main Binance.com platform does. As a result, U.S. traders may selling their tokens for BTC in preparation.
Moreover Bitcoin’s hashrate has recently reached a new all-time high, which means the network is now more secure than ever. Adding to that, its upcoming halving event next year, which will see block rewards drop from 12.5 BTC to 6.25 BTC, could be driving up its price, according to some analysts.