On March 20, 2020, Grayscale Investments, which operates trusts for Bitcoin (BTC) and Ethereum (ETH), released a report that provides much insight into institutional investment and its own confidence in the cryptocurrency market.
The Grayscale Ethereum Trust currently has 13,272,300 outstanding shares of Ethereum priced at 0.09425115 ETH per share. One Redditor, u/nootropicat, kindly did the math, and realized that Grayscale Investments must have purchased roughly 48% of all of the Ethereum that has been mined in 2020 - a sign that the firm has much confidence in the asset.
The report itself provides much insight into the influx of institutional investment. The Q1 2020 report has seen such investment double from Q3 2019 - Q1 2020 saw $503.7 million in investment, while Q3 2019 saw $254.8 million investment. Of this, Grayscale says that hedge funds are responsible for a majority of the investment. It also reports that $110 million in Q1 inflow, which exceeds the $95.8 million in inflow from the past 2 years.
Another point worth mentioning is that these investors are paying a high premium to invest in the asset, as investors are buying the aforementioned amount of Ethereum at each individual share for about 5 times the price available in the market. Such an act is some indication that there is confidence in the asset.
Institutional investment has been talked about at length in the past and is a clear sign that the market is growing. Grayscale has also reported that nearly $500 million has been invested in Bitcoin in Q1 2020.