Paul Brody, a prominent figure in the blockchain community and Global Blockchain Leader at Ernst & Young (EY), recently highlighted the growing demand for cryptocurrencies, with Bitcoin taking the spotlight. Earlier today, during an interview with CNBC, Brody emphasized the growing interest, especially from family offices.

Family offices are taking over

According to Brody, family offices, which typically manage the vast wealth of wealthy families, are increasingly diversifying their portfolios with cryptocurrencies. This is not entirely surprising, given the significant rise in the value of Bitcoin and its potential as a hedge against inflation and economic uncertainty.

However, while family offices are diving headfirst into the cryptocurrency pool, institutional investors are more cautious.

Brody notes that these large entities, which control more than $200 trillion in assets, are waiting for regulatory clarity, such as the SEC’s approval of the Bitcoin ETF, before committing significant resources.

Bitcoin, despite comparisons, is clearly different from traditional assets like gold. Brody highlights a unique feature of Bitcoin: its price does not lead to increased issuance. Instead, the issuance of new Bitcoin declines over time due to halving events.

This characteristic makes its price more “solid”, especially compared to other assets traditionally used as inflation hedges.

Moreover, the purpose of obtaining Bitcoin varies between buyers. Brody points out:

If you look at the people who are buying Bitcoin, they are buying it as an asset. They don’t buy it as a payment instrument.

Brody also points out that Ethereum, another major cryptocurrency, is mostly acquired for its utility as a computing platform, especially for business transactions and decentralized finance (DeFi) solutions.

Bitcoin to $40,000?

So far, Bitcoin has shown an upward trend, seeing a roughly 10% increase over the past week and a 4.7% rise over the past 24 hours. This increase has pushed Bitcoin to trade above the $31,000 level, reaching $31,824 recently.

By observing the chart of the asset in the 1-day time frame, it appears that BTC is poised for higher gains. As shown below, the asset has recently exploited a demand block and could continue its reversal to the upside, hitting a notable high.

Additionally, given the strong institutional demand for Bitcoin, as Brody revealed, along with the potential approval of a Bitcoin exchange-traded fund, a rally to the $40,000 mark appears to be on the horizon.

Moreover, pAs he heads into the future of the financial landscape, Brody believes traditional fiat currencies will continue to hold their ground.

However, with ongoing discussions around central bank digital currencies (CBDCs) and the growing adoption of stablecoins for payment, the world of cryptocurrencies may be poised to evolve.

With global political developments and pivotal elections on the horizon, Brody expects Bitcoin and the broader cryptocurrency space to see exponential growth in adoption and recognition.

Featured image from iStock, chart from TradingView