Who Has the Power, Retail or Institutional Investors?

There’s a scene in Pixar’s “A Bug’s Life” (a very underrated movie) where Hopper (the evil grasshopper) clocks his whiny brother with a seed. And then another. Neither really hurt, obviously. He then opens the valve to the large seed granary, and ouch.

The point Hopper was successfully making was that size and might do not necessarily equal power. That lies with the seeds, I mean the masses. Volume trumps influence.

We hear so much about “institutional influence” in the crypto markets that it’s easy to fall into the trap of thinking that institutions alone will decide when the next bull run will start. The “wall of institutional money” that most of us were breathlessly expecting in early 2018 was supposed to push the price of bitcoin and other assets “to the moon,” and savvy retail investors would tag along for the joyous ride (in a lambo).

A year later, we no longer talk about the “wall,” instead we are focusing on the infrastructure building and waiting for large incumbents to loudly declare their allegiance. Now we’re repeatedly told that “when Goldman/State Street/BNY start offering crypto services,” institutions will pile in.

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