Institutions Bullish on Cryptocurrency Regardlessย of Bear Market: Report
A recent report by cryptocurrency data provider Amberdata and worldwide financial services analyst Coalition Greenwich outlines that institutional investors remain optimistic about digital assets, even during the ongoing bear market. The report surveyed sixty asset managers, including hedge funds, deal financialย resources corporations, and family offices, primarily from the Unitedย States, Europe, and the Unitedย Kingdom. It found that 48% of the respondents asย ofย now have digital assets under management (AUM). Althoughย while most institutions hold between $1-10 Million in digital assets, 19% manage between $11-50 Million, and only one institution operates over $1 Billion in AUM. Regardlessย of concerns about the regulatory environment, 85% of the respondents believe that the Unitedย States Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) will provide positive opportunities for digital asset adoption. Nonetheless, challenges such as regulatory uncertainties, security practices, custodying digital assets, and blockchain performance continue to hinder institutional engagementย in the cryptocurrency space.
Cryptocurrency Roadblocks and Institutional Commitment
The report outlines plentyย of roadblocks faced by institutions that are not asย ofย now involved in cryptocurrency, including regulatory uncertainties, lack of common KYC/AML technology, unclear tax policies, custody complexities, security challenges, and blockchain performance issues. Nevertheless, one in every four institutions surveyed already has a dedicated role focused on digital assets, and this number is expected to grow by 13% in the next twelve months. The reportโs findings indicate that numerous institutions are prioritizing cryptocurrency products and services regardlessย of theย present bear market. Inย addition, regardlessย of the collapse of FTX, a wholeย lotย of number of asset managers still expect centralized exchanges to grow over the next five years.
Hot Take
The report outlines that institutional investors are not deterred by the cryptocurrency bear market and remain optimistic about digital assets. Regardlessย of concerns about the regulatory environment and numerous challenges, institutions are committed to offering specialized cryptocurrency services and expect positive opportunities in the future. This impliesย that institutional engagementย in the cryptocurrency space will continue to grow, contributing to the mainstream adoption of digital assets.
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