By Samuel Indyk
Investing.com – Activist investor Dan Loeb has said he has been doing a “deep dive” into the cryptocurrency market in a series of Tweets.
Loeb, who runs the New York based hedge fund Third Point, says it is a real test of being open to new and controversial ideas.
Continuing in a series of Tweets, Loeb also said that one conflict to overcome is the idea that “being late to the crypto party will inevitably lead to one taking the sucker seat at a high stakes poker table versus this still being early days in what is just now being adopted in the mainstream”.
Crypto going mainstream
The idea of crypto going mainstream has been bubbling away for weeks now. When Tesla Inc (NASDAQ:TSLA) announced last month that they had bought $1.5bln of Bitcoin to diversify their reserves, the price of the world's largest cryptocurrency skyrocketed.
Other large multinationals followed suit - including Mastercard (NYSE:MA) and Bank of New York Mellon (NYSE:BK) - and the momentum continued.
Cryptocurrencies have rallied - albeit with a correction last week – with the total market cap of bitcoin breaching $1tln a couple of weeks ago. The current market cap is just shy of $900bln.
Third Point
The fact that a large, high profile asset manager is talking about cryptocurrencies going mainstream will again be music to the ears of bitcoin investors. In its January monthly report, Third Point announced they had $16bln in assets under management. A small percentage allocated to cryptocurrencies could provide another catalyst for the price if others were to follow suit.
This is the theory underpinning the bull case for cryptocurrencies currently. Loeb has not confirmed that he plans to buy cryptocurrencies for his fund or invest personally, but this latest development could be something to keep an eye on in the coming weeks and months.