May has been a great month for bitcoin going from $5,200 to $9,100. This coincides with the blockchain week in New York with many events like Consensus, Magical Crypto, etc.
What is behind this sudden surge in bitcoin price?
As indicated by a new report from Binance, the biggest spot crypto exchange saw an unexpected spike in Bitcoin price in May. The report indicates that the surge was caused by an increase of interest toward bitcoin from institutions and retail users. A surge in their OTC market is also reported from new traders.
The project aims to build a trading platform and is supported, among others by billionaire VC fund Tim Draper.
“Compared to March and April, which were relatively quiet in altcoin space, May was a much more active month in terms of OTC trading. The initial move higher in BTC was likely fueled by Blockchain week in NY (Consensus, Magical Crypto Conference and other events) and led to a lot of renewed interest in buyers of BTCUSD…
We have [also] definitely seen more interest from the non-crypto public this month, and hope that the market ‘behaves’ such that the interest continues to build.”
The full report can be found here.
Another important thing the report points out is the premium price paid to buy Grayscale Bitcoin Trust where BTC is priced above $11,000. This clearly points to the fact that institutions are willing to pay a high premium just to get exposure to the crypto space.
“Institutional investors, currently representing (in our conservative assumptions) less than 10% of all long-term investors, are growing their exposure to digital assets and cryptocurrencies, as illustrated by a premium of nearly 40% for Grayscale Bitcoin Trust (GBTC) over BTC spot price at the end of May.”
Grayscale also announced the last week the launch of Grayscale ethereum trust.