Why Wall Street Is Lining Up To Buy Cryptocurrencies In 2020

The current economic depression, which came because of the Coronavirus pandemic, has thrown Wall Street a little off-balance. Up until now, you might be thinking that the 2007-08 recession might have prepared Wall Street for any further disasters. However, that is simply not the case.

With global markets tumbling by the dozen, the COVID-19 pandemic does not seem to end anytime soon. Given the nature of the pandemic, experts are comparing the same to the global depression of the 1920s. However, unlike the last depression, there is something new, which is happening on Wall Street.

In this article, we will look at why some of the biggest Wall Street investment firms and investors are seeking out cryptocurrencies. We will also shed some light on why Bitcoin and other crypto are rallying hard against the tide in the COVID-19 scenario.

Wall Street and Cryptocurrencies: A Weird Relationship

Goldman Sachs, JP Morgan and others have in recent times spoken about Bitcoin and other cryptocurrencies. While the initial reaction to crypto was one of staying away from the asset base, things have now changed a lot.

Many of the biggest firms on Wall Street are asking their wealthy clients to diversify their portfolio and expand into the crypto ecosystem.

Morgan Stanley the billion-dollar financial giant has even sent an open letter to its client base, explaining to them why they should have some crypto investments in their portfolio.

Many people are wondering why there has been a shift in the attitude of Wall Street towards cryptocurrencies. One reason for the same is the performance of the assets during the pandemic.

Even though Bitcoin dropped below the $3K mark, it rallied hard and is now settling in about the $12K level. As a form of financial asset, it shows maturity for investors and clients.

Does Wall Street Consider Crypto as a Hedge against Inflation?

Cameron and Tyler Winklevoss (remember them from Facebook fame) have built up one of the largest crypto asset bases in the world. Their crypto exchange, Gemini is performing strongly and gaining a lot of traction with both retail as well as institutional investors.

One major reason why the cryptocurrency is gaining serious traction with Wall Street is it acting like a hedge against inflation. Wall Street realizes that the more the Federal Reserve prints money, the higher will the inflation rise. With trade wars with China, the US economy is not looking as bright as Wall Street would want it to.

This is the reason why Wall Street experts are asking their clients to buy hedge assets like Bitcoin and Gold. Many also state that it would be better to store crypto assets, rather than stock up on gold.

Billionaire investors like Paul Tudor Jones, who has recently been vocal about his investments in Bitcoin states that diversifying portfolios into crypto is for the future. Many like him predict that Bitcoin is growing to break into the six-figure dollar bracket soon enough.

The Rise of Institutional Investors in the Crypto space

The year 2020 has been a watershed year for cryptocurrencies in general and Bitcoin in particular. The asset base has shown its strong resilience to survive tough times. With mainstream interest rising on Wall Street, Bitcoin and another crypto can experience a strong surge in value and demand.

If Wall Street is successful in entering the crypto ecosystem, it will start creating pressures on governments and financial institutions. This will force them to start regulating the crypto and consider it as an asset on par with mutual funds and precious metals.

According to leading, bitcoinup trading site the next few years are going to be very interesting in the cryptocurrency ecosystem. With growing retail investor sentiment also pushing Bitcoin, the currency is set for a bumper 2021 and 2022.