Besides the fear of missing out, a shift from gold to Bitcoin quickly picks up momentum among corporate investors as they now see it as a better store of value. For a long time, gold has been considered one of the safest ways to store wealth. While it has held up this position against paper money, which is way prone to inflation, the same cannot be said about Bitcoin.
One of the arguments presented by investors is that gold appears to be a lot less volatile in the short term. Famous Bitcoin analyst, Willy Woo, refuted this by looking at both in a broader time frame. The volatility of the pioneer cryptocurrency tends to drown over time, thereby making it more profitable for long term holders.
Bitcoin's finite supply further reinforces its value as there can be only 21 million BTC that would ever be in existence. It would appear that this fear of missing out exhibited by institutional traders is evident as the flow of funds has shown.
JP Morgan has pointed out proof of Bitcoin's institutional demand as investors move gold exchange-traded funds (ETFs) to the cryptocurrency. The firm showed that this massive demand for BTC is created not just by younger retail investors but also by corporate investors such as family offices and asset managers.
The direct contrast with the equivalent outflow trajectory for gold ETFs and the inflow into Grayscale Bitcoin Trust makes it more impressive. Over 1 billion was added to its crypto products in the third quarter of 2020.
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