Bitcoin took a sharp dip to $ 17,700 last night. The cryptocurrency crashed as the stock market underwent a correction and the US dollar showed some strength after a brutal showing over the past few weeks.
But BTC is already bouncing back. After falling to those lows, the cryptocurrency has soared to $ 18,400 at the time of writing this article.
This bounce comes to the news that a major US insurance company has bought Bitcoin to diversify its portfolio.
Related reading: This is why Ethereum’s DeFi market can be near a bottom
MassMutual buys Bitcoin
According to the Wall Street JournalThe American life insurance company Massachusetts Mutual Life Insurance has purchased $ 100 million worth of physical Bitcoin for its general investment account.
That account has $ 235 billion per outlet. This makes it a small percentage from that macro perspective; for a given context, BTC’s full market cap is only $ 340 billion.
Massachusetts Mutual Life Insurance, also known as MassMutual, serves five million customers. As an insurance company, it naturally has a large amount of capital on its balance sheet.
According to an interview with the company, Bitcoin gives the company “measured but meaningful exposure to a growing economic aspect of our increasingly digital world.”
The company purchased the Bitcoin through NYDIG, a New York-based custodian and execution company for the crypto asset space and its institutional investors.
NYDIG founder Ross Stevens told The Journal that “other high-yield insurance companies have also purchased bitcoin for their general accounts through his company.” These companies need returns to pay out claims and ensure their portfolios exceed inflation.
Related reading: Tyler Winklevoss: There will be a “Tsunami” of capital for Bitcoin
Some troubling signs remain
However, there are still some troubling signs for Bitcoin.
Crypto-asset on-chain analyst Ki Young Ju recently noted that about 800 BTC was being sent from a known miner’s address to Binance. While this may not have a major impact on the market, it could indicate that there are miners who think Bitcoin’s price will drop in the coming weeks and thus want to hedge their holdings.
This scares me
– Ki Young Ju 주기영 (@ki_young_ju) December 10, 2020
Related reading: 3 Bitcoin On-Chain Trends Show A Macro Bull Market Is Brewing
Featured Image from Shutterstock Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com Bitcoin Bounces Toward $18,400 as MassMutual Unveils $100m BTC Purchase