thecoinrepublic.com
- Bigger investors are unaffected by moves to regulate crypto assets
- Organizations are focusing their attention on the cryptocurrency’s strengths
- Institutional investors are unaffected by the threat of increased regulatory scrutiny of cryptocurrencies
The clamor for regulating the cryptocurrency sector is getting louder each passing day. Coupled with the debate over the U.S. infrastructure bill’s crypto tax reporting provision could be hindering the retail investors from investing in crypto assets. However, recent blockchain data from Glassnode indicates that the events did not affect institutional investors.
Organizations are focusing their attention on the cryptocurrency’s upside rather than the hurdles.
The bigger investors are represented by large-value dollar transactions, fueled by Bitcoin’s nearly 20% price gains last week. Experts believe that organizations are focusing their attention on the cryptocurrency’s upside rather than the hurdles in the way.
Joel Kruger, the cryptocurrency strategist at institutional crypto exchange LMAX Digital, noted that investors focus on the positive aspects rather than the negative aspects of the bill. The very fact that the U.S. Government is listening and is aware that there are some facts about the crypto in the infrastructure bill that needs more clarification.
Bitcoin on-chain transaction volume par values of at least $1 million have surged by 10% since the start of August and account for nearly 70% of the total value transferred.
CheckMate, a blockchain analyst at Glassnode, feels that the blockchain metric indicates surging institutional activities on the Bitcoin network since retail investors don’t move transactions with a value of at least $1 million on a scale that is gargantuan. The surging dominance is also linked to massive Coinbase exchange outflows since December 2020, which we also assign to likely U.S. institutions.
On a 14-day moving median basis, bitcoin transfers volume with values of at least $1 million.
The chart below also reveals that small transactions of less than $1 million have fallen and constituted 30-40% of market dominance from 70% since July 2020.
On a 14-day moving average, bitcoin transfer volume with values of less than $1 million.
Institutional investors are showing bullish sentiments when the crypto segment is experiencing increasingly intense political and regulatory developments worldwide. It includes a hotly debated $28 billion tax reporting provision to the $1 trillion infrastructure bill in the U.S. and an ongoing crackdown in Europe and other regions against Binance, the world’s biggest crypto exchange by trading volume.
The threat of increased regulatory scrutiny of cryptocurrencies
The threat of increased regulatory scrutiny of cryptocurrencies institutional investors is optimistic about bitcoin’s future, analysts and industry experts say. An executive at quantitative trading firm Efficient Frontier, Andrew Tu, said that institutions welcome regulations if they are fair and transparent. Moreover, the recent surge of prices of crypto assets reveals that the sector is not worried about regulations, as opposed to actual legislation passing.
On Monday, the latest infrastructure bill development, U.S. Sen. Richard Shelby (R-Ala.) filed an objection to a compromise amendment to the crypto tax reporting provision. The amendment would have negated the inclusion of crypto transaction validators from a broadened definition of “broker.”
Kruger added that the industry is getting its due recognition and will help in increased acceptance and adoption. As the industry matures, it is getting used to news coming from regulators. Tu said that the crypto industry is now used to regulatory concerns, especially the hodlers who have seen multiple cycles of regulatory uncertainty.