Large institutional investors are slow moving creatures from a financial system steeped in tradition, risk management, and regulations. For a pension fund to update its investment portfolio requires months, sometimes years of committee meetings, due diligence, and board approvals that are often repeated multiple times. <\/p>\n

To gain exposure to bitcoin by purchasing and holding real bitcoin requires a comprehensive vetting of multiple trading providers (e.g. Galaxy Digital), custodians (e.g. Coinbase), and forensics services (e.g. Chainalysis), in addition to forming new processes for accounting, risk management, etc. <\/p>\n

With such a strong rate of ETF adoption, it may come as a surprise that the price of bitcoin is only up 50% year-to-date. Indeed, if 48% of the top hedge funds are now allocated, how much upside could really be left? <\/p>\n

While the ETFs have broad-based ownership, the average allocations of the institutions that own them are quite modest. Of the major ($1b+) hedge funds, RIA\u2019s, and pensions that have made an allocation, the weighted average allocation is less than 0.20% of AUM. Even Millennium\u2019s $2 billion allocation represented less than 1% of their reported 13F holdings. <\/p>\n

The first quarter of 2024, therefore, will be remembered as the time when institutions \u2018got off of zero\u2019. As for when they will get past dipping their toes in the water? Only time will tell.<\/p>\n

This is a guest post by Sam Baker from River. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.<\/em><\/p>","protected":false},"excerpt":{"rendered":"

In hindsight, all it took for real institutional adoption of Bitcoin to take place was the introduction of a risk-minimized, easy-to-use product in the form of an exchange-traded fund (ETF). In January, the SEC approved nine new ETFs that provide exposure to Bitcoin through the spot market, a strict improvement over the futures-based ETFs that […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-25782","post","type-post","status-publish","format-standard","hentry","category-crypto-news"],"_links":{"self":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/posts\/25782","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/comments?post=25782"}],"version-history":[{"count":0,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/posts\/25782\/revisions"}],"wp:attachment":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/media?parent=25782"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/categories?post=25782"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/tags?post=25782"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}