Digital asset manager Grayscale now holds $20 billion worth of cryptocurrency, $17.5 billion of which is in Bitcoin.
The value of the firm’s holdings are up around 900% year to date, according to Barry Silbert, CEO of Grayscale parent Digital Currency Group (DCG):
“We did it! $20 billion in AUM to end 2020, up from $2 billion a year ago. […] Here’s to another 10x in 2021! Happy new year everybody.”
Much of the growth in the firm’s assets under management is a byproduct of an increase in institutional demand for Bitcoin, coupled with a rise in the Bitcoin price.
As the BTC Times reported previously, the Grayscale Bitcoin Trust (GBTC) absorbed $719.3 million worth of bitcoin during the third quarter of 2020, with the numbers expected to be equally as impressive for the fourth quarter, if not more so.
A vast majority of the firm’s investments come from institutional investors. In Q3, the percentage of capital inflow from investors such as hedge funds and family offices was 84 percent, making the growth in Grayscale’s asset under management is a proxy for the institutional interest in Bitcoin.
As evidenced by the introduction of individuals and firms like Paul Tudor Jones and SkyBridge Capital, investors are increasingly seeking Bitcoin as a hedge against the devaluation of the dollar.