This episode is the latest in the series of podcast “The Bitcoin Layer,” Daniel Batten – a well known Bitcoin advocate – discussed the possible impact sovereign wealth fund (SWF) could have on Bitcoin’s price. Batten predicted that the Bitcoin value would rise above $148,000 per BTC, should SWFs decide to even invest a fraction of assets. The $35.7 trillion managed by public pensions funds and SWFs could make a big difference to Bitcoin valuation.
Batten’s analysis is driven by the sheer size of the assets that SWFs manage and pension funds. Even a small investment in comparison to the assets they hold could have a significant impact on markets. He explained, “If a 1% deployment into Bitcoin were to happen, we can calculate based on the current ratio of dollar invested to market cap increase that it would lift Bitcoin price to over $148,000.”
Why it is likely that sovereign wealth funds will buy Bitcoin
Batten says that the main roadblock isn’t a lack interest, but a failure to create investment frameworks in these funds, notably with regard to ESG (Environmental, Societal, and Governance criteria). “All of the Sovereign wealth funds want to invest into Bitcoin. It’s not through lack of want,” Kevin O’Leary is quoted by Batten to highlight that ESG committees are currently limiting these funds. The committees have not yet been convinced by Bitcoin’s positive environmental attributes, Batten says.
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Batten said that ESG criteria are used to make investment decisions by SWFs. However, they are outdated and do not reflect the state of Bitcoin technology or its impact on the environment. “There’s a massive knowledge asymmetry where the knowledge that we now have about Bitcoin and its environmental benefits is now so different to what the ESG investment Committees of sovereign wealth funds believe about Bitcoin,” He stated.
Batten’s response to this challenge is not limited to conducted research But also began direct engagement with SWFs to update and educate their ESG Committees on the latest developments regarding Bitcoin’s impact on the environment. The goal of his mission is to remove the obstacles to investment by readjusting outdated perceptions and bringing them in line with the current reality.
Batten cited recent investment by US state pension funds, including those of Wisconsin, as evidence for his thesis. MichiganAlthough small, the campaign had a positive impact on market perceptions and a large media reach. “Wisconsin invested […] a total through Grayscale mainly. I believe their current position is around $160 million; that’s nothing compared to their total AUM […] however, even that very small allocation […] had a major impact on Bitcoin price that day,” Batten remarked.
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Batten is of the opinion that SWFs are not just a Bitcoin contributor. bull runBut they also can stabilize and legitimize a market that is more open to a broader audience of conservative investors. He believes it is more likely for WSFs to invest in Bitcoin rather than another large nation-state or company such as MicroStrategy.
“He concluded” “Yes there is a blocker and there is effort required to go through it and it is hard but it’s nowhere near as hard in my view as convincing a nation state to adopt Bitcoin. So this is an area where whilst it’s hard, it’s not as hard as other areas and it’s also that there’s only one blocker there’s not a whole bunch of them and in most cases that is the ESG investment committee.”
BTC is currently trading for $58,500.
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Source: www.newsbtc.com
