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Institutional investors are buying Bitcoin in large quantities, perhaps viewing it as a long-term reserve asset
According to a report by Fidelity, Bitcoin has been bought in large quantities by institutions, and the reserves of exchanges have dropped to 2.6 million.
Fidelity Digital Assets report shows that Bitcoin (BTC) is rapidly flowing out of exchanges and is being massively absorbed by institutional investors such as companies and sovereign wealth funds, resulting in a tight supply of Bitcoin.
According to the report, the current Bitcoin reserves of cryptocurrency exchanges have dropped to 2.6 million, the lowest level since November 2018. Looking at this year alone, companies have purchased more than 30,000 Bitcoins per month.
The report analyzed that the phenomenon reflects that institutional investors no longer view Bitcoin as a short-term trading tool, but as a long-term reserve asset. It is believed that this strategic shift will accelerate in the future, and the position of Bitcoin in corporate financial strategies will become increasingly important.
The report also pointed out that sovereign wealth funds accumulate Bitcoin as a tool to hedge against the depreciation of the US dollar and inflationary pressure.
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