Many analysts and critics have shared their contrary opinions on the growing institutional adoption of Bitcoin, as analysts believe that the growing adoption of the cryptocurrency is will positively affect its price value and should be encouraged for the growth of the digital assets and the cryptocurrency market in general.
Unfortunately, critics believe that the asset’s price volatility nature makes it a terrible hedge against investments like equities. Corporations should not be swayed by the quick profits looming, as it could also come with quick losses, which can alternatively sway the fortunes of a business.
Tesla is just the headline to the main news, according to the Mayor
However, popular Miami Mayor, Francis Suarez, popularly known as a Bitcoin enthusiast, believe that the recent purchases of Bitcoin by institutional investors like Tesla only means that the cryptocurrency will see more purchases as the year goes by. Bitcoin continues to be the most preferred cryptocurrency asset for many investors, especially of institutional nature, as everyone seems to get involved in the Bitcoin party.
However, Francis believes that Tesla’s $1.5 billion purchase is just the headline of the significant events that Bitcoin and the cryptocurrency space will witness during the year. The year’s predictions were centered around the cryptocurrency market’s growth, as they believe that the market will triple in size by December 2021.
The cryptocurrency space has continued to be the most preferred place for many investors to invest their resources, with the sole focus on valuable assets like Bitcoin, Ethereum, and a few other altcoins. However, Francis believes that the growth of Bitcoin, which is now the most preferred digital asset by many large institutional investors, means that many more institutional investors will buy more of the cryptocurrency than Tesla, whose $1.5 billion is pegged as the highest single purchase of the cryptocurrency.
The Mayor believes the high demand for Bitcoin is not slowing down
The Mayor believes that most individuals seek solace in Bitcoin as the current inflation rate in many nations continues to be high. Individuals have fled to cryptocurrencies since last year’s Global pandemic. The Mayor also feels like the reason many institutional investors are running towards Bitcoin is also due to last year’s economic dip suffered by many firms due to the effect of the COVID-19 pandemic.
This situation has left many organizations at losses. The preference of short-term holding high-risk investment of assets like Bitcoin is now preferred over long-term holding medium-risk assets like Stocks by many corporations. It is also another reason why the Mayor feels Bitcoin will continue to thrive.
The Mayor also echoes the words of many analysts who believe that the wide adoption of Bitcoin into the business services of many firms like payment companies, traditional commercial banks, and other FinTechs, will likely lead to more demand for the cryptocurrency whose market capitalization is currently above $1 trillion as at the time of writing.