Institutional Investments in Bitcoin and Ethereum Surge
According to a recent Reuters report, institutional investments in Bitcoin (BTC) and Ethereum (ETH) have been on the rise in recent months. One notable investor, Peter Thiel-backed Founders Fund, reportedly invested $200 million in these two cryptocurrencies during the summer of 2023. The fund divided its investment equally between BTC and ETH.
Founders Fund’s Return to the Bitcoin Market
The Founders Fund began acquiring Bitcoins last summer when the price was below $30,000. This is not the first time the fund has invested in Bitcoin, as it previously made a significant bet on the cryptocurrency in 2014. However, it liquidated its holdings before the 2022 crypto market crash, resulting in substantial returns of around $1.8 billion.
This move by Founders Fund highlights a renewed interest in token investments among institutional investors. Many funds that exited the market after the 2022 crash are now re-entering and making fresh investments.
Peter Thiel’s Affinity for Crypto
PayPal co-founder Peter Thiel has publicly expressed his admiration for Bitcoin. He sees it as a store of value similar to gold and a hedge against central bank policies. Thiel is attracted to Bitcoin’s foundation on blockchain technology and its independence from traditional financial institutions, aligning with his interests in libertarianism, limited government, and technological progress.
This sentiment is reflected in Founders Fund’s investment philosophy. With assets exceeding $12 billion, the fund has supported companies like SpaceX and Meta. In April 2023, Joey Krug joined as a partner specifically responsible for overseeing crypto investments.
The recent introduction of spot Bitcoin ETFs has led to a significant increase in institutional inflows into Bitcoin. A spot Ethereum ETF is also expected to launch in May 2023, further boosting institutional participation in the crypto market.
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