Famous Bitcoin maximalist Max Keizer has claimed on X that Qatar’s sovereign wealth fund, the Qatar Investment Authority (QIA), is preparing to make a massive investment in the cryptocurrency. While this rumor should be taken with a grain of salt, several elements make it credible. Investigation.
A rumor to be taken with a grain of salt
In an already euphoric context, a tweet posted on December 4 by the famous bitcoin maximalist Max Keizer had the effect of a bomb:
“I have a word for you fans of the $100,000 Bitcoin Divine Candle. . . CATARRH. Rumors are very urgent on this topic. Their sovereign wealth fund is reportedly trying to buy half a trillion dollars worth of #BTC. »
I have 1 word $100,000 for you #Bitcoin God Candle fans. . .
QATAR 🇶🇦
Rumors of this are getting very loud.
Their SWF was rumored to want to buy 1/2 trillion #BTC pic.twitter.com/hm86KwtAj7
— Max Keizer (@maxkeiser) December 4, 2023
In the hours following this announcement, the price of Bitcoin, which was already making good progress, saw another jump to reach $42,000.
The enthusiasm which this rumor caused is easily explained. Indeed, the Qatar Investment Authority (QIA) is one of the largest sovereign wealth funds in the world, operating mainly in Europe, where it has acquired stakes in giants such as Volkswagen, LVMH and Airbus.
However, it seems too early to conclude that Qatar is poised to become one of the biggest Bitcoin whales in the world, because no concrete information has come to confirm the rumor. So it is entirely possible that Max Keizer only wanted to spread this rumor to increase his own investment in Bitcoin.
Upon request from Cryptoast, the Qatar Investment Authority did not provide comment on Max Keizer’s publication at the time of writing.
So we decided to investigate determine whether or not Qatar’s investment in Bitcoin represented a plausible scenario.
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Is bitcoin a relevant investment for Qatar?
It wouldn’t be surprising if a country like Qatar were interested in an asset that is set to more than double in value by 2023 and whose recent rise has surprised even the most optimistic.
“It does not seem irrational. Qatar has had a sovereign fund since 2005 and there is no reason why it should not be interested in the cryptocurrency sector. »
However, the amount presented by Max Keizer seems to be exaggerated. According to the latest data provided by the fund, QIA reportedly holds $475 billion, which is less than the amount stated in the tweet. However, if he invested only a few billion dollars, it would already represent a gigantic injection of liquidity for the cryptocurrency market.
Bitcoin now seems difficult for investors to ignore, although it is one of the best-performing assets of all types combined since the beginning of the year. It is thus ranked among the 10 assets with the largest capitalization, in the 9th position, right behind the shares of Nvidia, Amazon, Apple and Google and precious metals such as gold and silver.
“The growth of BTC can be attributed to many factors. The economic environment is improving and rates are expected to decline, which is generally favorable for risk assets. A Bitcoin spot ETF appears imminent and is the subject of numerous discussions, fueling the interest of institutional players such as BlackRock. We are also seeing an increase in activity on the Bitcoin network with Ordinals. »
Qatar’s supposed interest in Bitcoin would thus fit into the context of the massive arrival of institutional investors to the market.. The expected approval of BlackRock’s bitcoin spot ETF and other players by the US financial markets policeman, the Securities and Exchange Commission (SEC), could finally convince a fund like Qatar’s to open the floodgates.
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“For an investment fund, bitcoin meets the basic criteria. It is now considered a store of value as it has become an adornment of the values associated with raw materials. And it allows you to diversify your investments. »
Diversification is indeed a crucial aspect for the countrys, whose economy has long depended only on oil, gas and other raw materials.
The change in sentiment seen in the cryptocurrency markets in recent weeks is a factor that is likely to convince Qatar to invest in Bitcoin:
“It is possible that the Qataris were waiting for strong signals before jumping on the bandwagon.” Now we are in a virtuous circle and the positive signals react on each other. Nobody wants to be left behind. »
It seems that the risks weighing on the crypto market are gradually disappearingwhich leaves room for a comforting environment for institutional actors:
“The announcement of an agreement between the United States Department of Justice and Binance, which has cleared a number of charges, reduces the likelihood of a black swan scenario like the one we experienced with FTX. This sets the stage for the upcoming bull run. And interestingly, the previous cycles were not fueled by traditional finance, which is now interested in this. »
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Special interest in new technologies
Qatar’s interest in Bitcoin would also seem consistent with the country’s growing interest in new technologies. After initially investing in traditional sectors, QIA has made a shift in strategy in recent years to focus on emerging sectors such as biotechnology and now artificial intelligence. So Bitcoin would have its place in such a portfolio.
The president of Qatar’s sovereign wealth fund, Mansoor bin Ebrahim Al-Mahmoud, has certainly been skeptical of cryptocurrencies for a long time. In September 2021 thus he estimated that they “need some maturity” before Qatar would consider investing in them.
However, the tone seems to have changed, perhaps the country believes that the crypto market has reached the necessary maturity. In June 2022, during the Qatar Economic Forum, Mansoor bin Ebrahim Al-Mahmoud stated that he is studying the possibility of investing in blockchain technology.
And while in 2020, Qatar introduced very restrictive regulations regarding the possession and use of cryptocurrenciescould the country revise its position. A new, more flexible legal framework should be introduced in January 2024.
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Qatar is also involved, like many countries around the world, in a program to establish its own MNBC (central bank digital currency). The governor of the Qatar Central Bank, particularly enthusiastic about the topic, stated that crypto-assets represent “technological innovation (…) that will lead to a new era of fast payments and affordable financial services”.
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Finally, a few months ago, Qatar has unveiled the creation of a digital asset lab aimed at accelerating the adoption of blockchain in the country’s financial sectorby signing partnerships with blockchain-related companies such as R3 and Settlemint.
A deal between Qatar and El Salvador?
Qatar would not be the first country to invest in Bitcoin. Already in 2020, a Norwegian pension fund, based in part, like Qatar, on income from the country’s oil reserves, acquired shares in MicroStrategy, one of the largest investors in Bitcoin in the world. After recently raising 16,130 BTC, the Michael Saylor-led firm now holds 175,000 Bitcoins. Every Norwegian is thus exposed to cryptocurrency without even knowing it.
Another avenue remains to be explored regarding rumors of Qatar investing in Bitcoin. According to some observers Max Keizer’s tweet could refer to a possible partnership between Qatar and El Salvadorwhich adopted Bitcoin as legal tender in September 2021. Max Keizer is actually one of Salvadoran President Nayib Bukele’s close crypto-currency advisors and thus could have access to some previously confidential information.
Last September, President Bukele received Qatari Emir Tamim bin Hamad Al-Thani to discuss, in particular, trade partnerships in sectors as diverse as health, sports and agriculture.
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In time, when, there has already been a rumor that Qatar is investing in huge farms that the country is building to mine bitcoins. The equipment that could turn a small Central American country into the biggest BTC miner on the planet.
We’ll probably have to wait a little longer to find out how much truth there is to the rumors Max Keizer started.. However, there is no doubt that the official announcement of Qatar’s investment in Bitcoin would have the effect of provoking, in the words of a Bitcoin maximalist, “divine candle”. This, even more so if it is accompanied by the announcement of the validation of spot Bitcoin ETFs from the United States Securities and Exchange Commission.
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A journalist passionate about blockchain, the Web3 ecosystem and digital arts, I cover the evolution of these fast-growing industries.
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