Paul Brody, a prominent figure in the blockchain community and the Global Blockchain Leader at Ernst & Young (EY), recently shine light about the growing demand for crypto, with Bitcoin in the spotlight. Earlier today, Brody highlighted the increased interest, especially from family offices, during a CNBC interview.
Family Offices lead the charge
According to Brody, family offices, which typically manage the vast wealth of wealthy families, are increasingly diversifying their portfolios with cryptocurrencies. This isn’t entirely surprising, given Bitcoin’s meteoric rise and its potential as a hedge against inflation and economic uncertainty.
However, while family offices are diving headlong into the crypto pool, institutional investors are being more cautious.
Brody mentions that these larger entities, which control more than $200 trillion in assets, are waiting for regulatory clarity, such as the approval of a Bitcoin ETF by the U.S. Securities and Exchange Commission, before committing significant resources.
Bitcoin, despite comparisons, is clearly different from traditional assets like gold. Brody highlights a unique feature of Bitcoin: its price does not result in increased issuance. Instead, the issuance of new Bitcoin decreases over time due to halving events.
This characteristic makes the price more ‘rigid’, especially compared to other assets traditionally used as inflation hedges.
Moreover, the purpose behind acquiring Bitcoin varies from buyer to buyer. Brody points out:
When you look at people who buy Bitcoin, they buy it as an asset. They don’t buy it as a means of payment.
Brody further notes that Ethereum, another major cryptocurrency, is being purchased primarily for its usefulness as a computing platform, especially for business transactions and decentralized finance (DeFi) solutions.
Bitcoin to $40,000?
So far, Bitcoin has shown a bullish trend, up almost 10% in the past week and up 4.7% in the past 24 hours. This surge has pushed Bitcoin to trade past the $31,000 mark, recently reaching $31,824.
Looking at the asset’s chart within a one-day time frame, BTC appears poised for even higher gains. As shown below, the asset has recently touched an order block and could continue its upside move, reaching a notable high.
Furthermore, given the strong institutional demand for BTC as revealed by Brody, coupled with the possible adoption of a spot BTC ETF, a rally to the $40,000 mark appears to be on the horizon.
Further, pAs he looks ahead to the future of the financial landscape, Brody believes that traditional fiat currencies will continue to endure.
However, with the persistent discussions around central bank digital currencies (CBDCs) and the growing adoption of stablecoins for payments, the crypto realm may be primed for evolution.
With global political developments unfolding and crucial elections on the horizon, Brody foresees Bitcoin and the broader crypto space experiencing accelerated growth in adoption and recognition.
Featured image from iStock, Chart from TradingView