Major bitcoin mining and blockchain technology firm Bitfury reportedly received bids from various investors and assets under management (AUM) funds over the past week as bitcoin price surged past US$800. In response, Bitfury Vice Chairman George Kikvadze firmly declined their offers, stating that the company isn’t and will not be interested in selling their bitcoin in the future.
On social media, Kikvadze revealed that the Bitfury group received offers from large-scale and high profile investors as the bitcoin price surpassed the $800 margin. Many analysts and experts including Civic CEO and angel investor Vinny Lingham predicted bitcoin price to go straight to $900 once it hits $800. Such predictions and the rapidly rising demand for bitcoin in countries like China pushed conventional investors to purchase bitcoin.
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Bids From $25 to 43 Million Declined
Within 24 hours since bitcoin hit the $800 mark, Kikvadze and the rest of the Bitfury group received bids to buy 30,000 to 50,000 bitcoins by AUM funds and high profile investors. As of today, 50,000 bitcoins are equivalent to $43 million.
Several bitcoin communities suggested that AUM funds and other investors must purchase funds at exchanges instead of attempting to secure affordable direct deals with miners. A large number of users used the term “the real public market” in referring to the bitcoin exchange market and regulated trading platforms.
While conventional bitcoin exchanges and trading platforms are viable and practical to traders and investors obtaining personal funds or investments, it is inefficient for investment firms or large-scale corporations seeking out for multi-million dollar investments in bitcoin.
For instance, the largest bitcoin exchange in Korea called Korbit, which has some of the most valuable investors and partners in all of the South Korean financial industry including $15 billion telecommunications company SK and $74 billion investment firm SoftBank, has a bitcoin withdrawal or trading limit of $171,000.
Thus, for corporations or investment firms like the AUM funds that submitted their bids to the Bitfury group, purchasing $43 million worth of bitcoin in exchanges that have a trading limit in the range of $100,000 to $200,000 will be inefficient.
Bitfury’s Decision to Keep Bitcoin
Bitfury’s official decision to decline all of the submitted bids as well as future sale inquiries is a foreseen for a company that considers bitcoin as a global currency and a store of value. It is likely that the Bitfury group does not see any benefits in trading their assets in bitcoin for cash or any other forms of assets at this time of global economic instability and tightening financial regulations.
More importantly, the necessity of cash is rapidly declining with over 39% of the world’s population depending on alternative financial services other than cash or fiat-money based systems like bank accounts and credit cards.
In all, the increasing number of bids being submitted by AUM funds and investment firms should be considered as the mainstream and conventional financial industry’s increasing interest in bitcoin. Earlier this week, Digital Currency Group CEO and founder Barry Silbert expressed his enthusiasm in the fact that a small circle of companies and media outlets were covering the surging bitcoin price.
However, as seen in the submission of bids to Bitfury, large-scale corporations and investment firms are already attempting to hold bitcoin as alternative assets and global store of value.
Do you think more investment firms and AUM funds will be interested in bitcoin? Let us know in the comments below.
Images via Cosentini Associates
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