Cryptocurrency market rallied aggressively as the week commenced, with Ethereum now on track to retest the $150 level and Bitcoin ever so closer to moving back above the $4,000 level. Network fundamentals may be showing a somewhat mixed picture, but there are increasing signs that institutional investors will be moving to the new crypto asset class. According to Cambridge Associates, a consultant for pensions and endowments, institutional investors should consider dipping their toes into cryptocurrencies. However, the group points out that for those prepared to take the plunge, a “considerable amount of time learning about the space” is highly recommended, including surveying the different ways of investing, from illiquid venture capital funds to buying tokens on a crypto exchange. In short, institutional money is coming but give them time to get up to speed with terms like HODL and REKT. Indeed, such a move will be very positive for the industry and for the players that are already on the crypto market. It should act as a catalyst to enforce more regulation and encourage the participation from professional money managers. The more smart money moves in, the less short-sighted the cryptocurrency market will become and will in turn attract even more participation.
Ethereum (ETH) is under the spotlight given the hard fork and it is worth pointing out that inflation, in the form of new supply issuance related to ICOs, has been blamed for the ETH's under-performance over the course of 2018 and resulted in constant critique by the leading crypto market commentators. Early last year, an article surfaced — "Vitalik’s Serious Joke: The Case For Ending Ethereum Inflation". Buterin appears aware of the concern, citing “economic sustainability” as the reason he wants to stop creating new Ethereum when 120 million are introduced. See more here.
Transition from Proof-of-Work to Proof-of-Stake was supposed to address some of these inflation related concerns. This move, however, has been plagued with delays. Still, inflation has since subsided and in fact now stands at a mere 0.69%, whereas Bitcoin inflation rate is now at 3.3%.
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