© Reuters
Investing.com – Investors are largely approaching the cryptocurrency industry as “strategic builders” or “spectators” during the recent rally in , according to analysts at Bernstein.
Bitcoin, the world's most popular digital asset, is up more than 400% from its 2022 lows, and is now within striking distance of an all-time high of $68,999. Still, trading volumes have been relatively subdued, in a possible indication that confidence in cryptocurrencies has been shaken by a series of high-profile frauds and bankruptcies.
Instead, gains have been driven primarily by continued capital inflows into Bitcoin following the approval of several US exchange-traded funds that directly track its price.
Data from digital asset manager CoinShares showed that Bitcoin-linked investment products recorded a fifth consecutive week of capital inflows in the week to March 4, a total of $1.7 billion. While short positions in the token increased, US-listed ETFs that track Bitcoin, particularly offerings from BlackRock (NYSE 🙂 and Fidelity), took up the bulk of the inflows.
In a note to clients, Bernstein analysts said these firms are increasing their exposure to cryptocurrencies “strategically” as they pursue “what will be the fastest-growing niche” in asset management.
But most traditional equity managers, Bernstein analysts noted, are choosing to “watch on the sidelines.” They argued that these investors should correct what they called an “abysmal allocation” to crypto-exposed stocks like Bitcoin miners. clean spark (NASDAQ:) and Riot Platforms (NASDAQ:).
“The opportunity for cryptocurrencies lies in this adoption curve,” the analysts said.
