[ad_1]
REUTERS / Stephen Lam
- Guggenheim Partners revealed in a regulatory document Friday that its Macro Opportunities Fund was entitled to invest up to 10% of its net asset value in Grayscale Bitcoin Trust.
- The trust invests exclusively in Bitcoin and a 10% bet from the Guggenheim fund would equate to around $ 530 million.
- The cryptocurrency jumped to an intraday high of $ 19,873.23 on Monday, eclipsing the record set in December 2017, before reducing gains.
- Watch live bitcoin trading here.
Guggenheim Partners is the latest Wall Street firm to show interest in Bitcoin, and a regulatory filing on Friday signals the company could make a massive investment in the rising cryptocurrency.
Guggenheim revealed in a Securities and Exchange Commission document released Friday that its Macro Opportunities Fund was entitled to invest up to 10% of its net asset value in Grayscale Bitcoin Trust. The trust invests exclusively in Bitcoin, allowing its shares to act as a proxy for the popular cryptocurrency.
The fund manages approximately $ 5.3 billion in assets, making a 10% investment worth approximately $ 530 million.
Guggenheim described cryptocurrencies as “digital assets designed as a medium of exchange”. The firm added that while it could gain exposure to Bitcoin through grayscale trust, it had no other plans to invest directly or indirectly in cryptocurrencies.
Read more: GOLDMAN SACHS: Buy these 16 stocks which are underestimated for now, but should crush expectations in 2021-22 towards a rise of at least 20%
Bitcoin hit a record high on Monday, surpassing the record of $ 19,511 set in December 2017. The token jumped to $ 19,873.23 before reducing some gains.
Guggenheim joins other Wall Street heavyweights who have expressed optimism about the volatile token. Mike Novogratz, the former hedge fund manager who has long pushed for widespread use of cryptocurrencies, praised PayPal’s October decision to adopt them, describing it as an “exciting day” for technology.
“All banks will now be in a rush to serve cryptocurrencies,” he said tweeted on October 21. “We crossed the Rubicon people”.
Read more: “ Stock Markets Turned into Casinos ”: Former Wall Street Chief Strategist Unloads On Toxic Narratives Fueling a Speculative Bubble and Begs Investors to Heed the 1999 and 2007 Warnings
Billionaire investor Paul Tudor Jones also backed Bitcoin last month, believing the asset “the best inflation trade.” With the Federal Reserve set to temporarily allow for inflation above 2%, Bitcoin’s decentralized nature protects its value from faster price growth, Jones said.
The Guggenheim filing suggests the company is optimistic about Bitcoin but still sees several risks for the coin’s run-up. A stake in Bitcoin could fall prey to its “highly volatile” nature, the company said in the document. He added that the cryptocurrency’s value “could drop precipitously” for reasons such as regulatory changes, a change in user preference for a competing token or a “crisis of confidence” in the Bitcoin network.
Bitcoin was trading at $ 19,232.35 at 12:25 PM ET, up about 166% year to date.
Now read more about the markets from Markets Insider and Business Insider:
Warren Buffett expert John Longo explains why Berkshire Hathaway invested billions in pharmaceutical stocks, pulled out of Costco and increased stock buybacks last quarter
Here’s how the US economy could transform under Biden following her appointment of Janet Yellen as Secretary of the Treasury, starting with a sizable stimulus
“ No longer a stock but a full casino ”: Palantir will lose a third of its value by the end of the year after growing more than 300% since it went public, says Citron Research, short seller
[ad_2]
Source link
