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Retail investors buying more Bitcoin (BTC) than institutions, says JPMorgan

Retail investors are already outpacing their institutional counterparts in terms of the volume of Bitcoin (BTC) purchases.

Fri, 19 Mar 2021, 10:00 am UTC

The crypto market rally, which saw Bitcoin (BTC) and Ether (ETH) set new all-time highs, has been attributed in part to the entry of institutional investors into the space. However, new data suggests that retail investors are now outpacing institutions in Bitcoin buying for the past three months.

With the rally pushing the crypto’s price to new heights, retail investors have been busy buying more Bitcoin this year. According to researchers JPMorgan, retail traders purchased 187,486 BTC so far for the first quarter of 2021, Bloomberg reported.

In fact, retail investors are already outpacing their institutional counterparts in terms of volume. According to JPMorgan’s data, institutional investors only purchased 172,684 BTC since January this year or around 7.9 percent lower than the volume of retail purchases for the same period.

Retail investors’ purchases were made via popular mainstream firms, which offer crypto trading features via their apps. Investors bought 107,416 BTC through PayPal while 80,010 BTC were purchased via Square.

“For many retail cryptocurrency traders, Bitcoin was the bread-and-butter trade of the pandemic, Oanda Corp senior market analyst Ed Moya told Bloomberg. “Meme stock trading volatility burnt many, but Bitcoin has maintained an amazingly bullish trend that has made most winners. Retail traders got reinvigorated with the latest NFT buzz and as the stimulus checks hit their bank accounts.”

A recent survey by Mizuho revealed that 40 percent of stimulus checks recipients plan to invest a portion of the amount on stocks and Bitcoin. Based on Mizuho’s computations, the Bitcoin market may soon get an infusion of up to $24 billion from American households.

While retail volume might have outpaced institutional volume recently, MJP Wealth Advisors president Brian Vendig noted that institutional participation might have triggered some of the retail investors to enter the market.

“When institutions started to get more into the space, that shows market leadership and helps to show validation for something and then individual investors also want to participate,” Vendig said. “As you see something taking off, that creates an impulse where you want to participate -- that balancing act tilting more to the greed side or the fear of missing out, I’m sure that’s a component to it as well.”

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