[Bitcoin Now] 7 out of 10 Institutional Investors Say It Will Stay Above $40,000

MicroStrategy Purchases Additional 205 Bitcoins
Ethereum Fee Reform 'EIP-1559' to Launch in July... Approximately 8.4% Increase

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[Asia Economy Reporter Gong Byung-sun] The leading cryptocurrency Bitcoin has risen to the 58 million KRW range. Investor sentiment is optimistic as a survey conducted by major U.S. bank Goldman Sachs showed that 7 out of 10 institutional investors predict Bitcoin will maintain above $40,000 (approximately 45.2 million KRW). Meanwhile, Ethereum's price surged after developers decided to provide information about transaction fees, which users had previously complained about.

According to the domestic cryptocurrency exchange Upbit, as of 10 a.m. on the 8th, Bitcoin recorded 58,862,000 KRW, up about 1.2% from the previous day. It stayed in the 56 million KRW range on the 7th before rising to 58 million KRW at 5:20 p.m.

The price increase appears to be driven by institutional investors expressing a favorable stance toward Bitcoin. On the 5th (local time), Matthew McDermott, head of Goldman Sachs' digital assets division, said on a podcast, "We learned through a survey that institutional investors are interested in Bitcoin," according to U.S. economic media Business Insider.

In a survey conducted by Goldman Sachs on the 3rd, 76% of 280 institutional investors including banks, insurance companies, and pension funds were optimistic about Bitcoin's future. Among respondents, 22% said Bitcoin would rise above $100,000 within the next 12 months, and 54% predicted Bitcoin would fluctuate between $40,000 and $100,000.

In fact, institutional investor sentiment is flowing toward Bitcoin. Following Tesla's disclosure on the 8th of last month that it purchased about $1.5 billion worth of Bitcoin, mobile payment company Square also announced in its Q4 earnings report on the 23rd of last month that it purchased $170 million worth of Bitcoin. Banks are also eyeing Bitcoin. On the 1st, Goldman Sachs decided to reopen its cryptocurrency trading desk, which had been closed since 2018. Major U.S. bank Citigroup also expressed a favorable view, claiming Bitcoin could be used as an international trade medium.

Amid this, cloud software company MicroStrategy decided to increase its Bitcoin holdings. MicroStrategy, which holds the largest amount of Bitcoin among private companies, announced on the 5th that it purchased 205 Bitcoins for $10 million. The average purchase price was $48,888. As of that day, MicroStrategy's Bitcoin holdings increased to 91,604 coins.

Ethereum also surged sharply. As of 10 a.m. on the same day, Ethereum recorded 1,990,500 KRW, up 1.1% from the previous day. It maintained the 1.7 million KRW range on the 5th before rising about 8.4% to 1,924,000 KRW at 7:57 a.m. on the 7th.

The price increase is attributed to Ethereum developers deciding to introduce the fee structure reform proposal ‘EIP-1559’ in July. When transacting with Ethereum, the higher the fee paid, the shorter the transaction processing time. However, since there was no information about fees, users have been paying excessively high amounts of Ethereum like gambling to reduce transaction processing time. To solve this problem, Ethereum developers decided to provide base fee information so users can predict fee prices. Additionally, only the base fee will be paid to miners, and any excess will be burned. Burning the excess reduces Ethereum supply, which has the effect of increasing its value.