Institutional interest is rising as Morgan Creek Digital, Bakkt, Iconiq Lab, Bittrex, and Coinbase among others roll out the red carpet for the institutional investors with their focused bitcoin & crypto offerings. Meanwhile, Deloitte study gives us an insight into business’ interest in blockchain technology.
Institutional interest on rising
Institutional investors’ interest has been believed to drive the Bitcoin price to the new peaks. Given the fact that these investors will bring in a huge amount of money, the facet holds credibility. However, a number of crypto enthusiasts also believes the entry of institutional investors will further lead to huge amount of price manipulation of sorts as significant money will be pumped and dumped.
Nevertheless, institutional interest has peaked and is constantly growing. Gradually, they are making their entry into the crypto market, though at a slow pace, while working out their bigger plans behind the closed doors.
According to a recent study by Deloitte, 84% of businesses claim blockchain-based solutions to be better than the conventional technologies. However, 39% cites regulatory issues and 28% lack of understanding the barriers in implementing this technology.
Big names are making their way into crypto
Previously, companies like Circle, Coinbase, Binance, and ledgerX among others have reported the significant rise in institutional interest.
Moreover, names like Goldman Sachs, Northern Trust and recently Bank of America got into crypto via custody route. However, a number of big names in the crypto market are rolling out the red carpet for the institutional investors.
It all started with Coinbase and its introduction of premium products and services targeted exclusively towards institutional investors. And now others are ready to further propel it forward.
To start with, Bittrex, a US-based crypto exchange has brought forth a number of factors like fiat trading, expansion plans and opening its services to institutional investors.
Bakkt, the big deal or ETF on steroids
The biggest exchange group NYSE’s parent company ICE introduced Bakkt, a digital asset platform to be released in November. Kelly Loeffler, the CEO explicitly stated:
“Bakkt is designed to serve as a scalable on-ramp for institutional, merchant and consumer participation in digital assets by promoting greater efficiency, security, and utility.”
With physically-backed futures, as promised by the company, this platform will enable the institutional investors to buy Bitcoin through its regulated market infrastructure. Furthermore, she mentioned in her “An evolving market – The need for trusted price formation” post, no leverage or margin will be allowed rather all the bitcoin contracts of Bakkt will be pre-funded or collateralized.
Morgan Creek welcomes institutional investment in Bitcoin
In partnership with Bitwise Asset Management, Morgan Creek Digital has launched a digital index fund. The fund will offer crypto exposure to accredited investors, pensioners, and wealthy individuals as stated by Anthony Pompliano, the Morgan Creek Digital partner:
“We’re fully prepared and feel we’ve built something that institutional investors will find attractive regardless of how the assets are categorized. Whether they’re securities or not.”
The portfolio of the fund involves the largest of the ten digital assets viz. Bitcoin (70%), Ethereum (15%), Bitcoin Cash (BCH), Litecoin (LTC), EOS, Monero (XMR), Dash, Ethereum Classic (ETC), Zcash, and OmiseGo (OMG). But, it excludes Ripple and Stellar as he revealed:
“If there’s a central party that owns 30% or more of supply, then we withhold those from the index. Because we think that introduces a lot of additional risks that may not be there if it was a more decentralized network.”
Iconiq lab making ICOs & cryptos accessible
Also, German-based Iconiq Holding is launching a series of digital asset index funds that according to its managing partner, Maximilian Lautenschläger would bring new capital into the crypto market:
“Iconiq’s aim is to make ICOs and crypto investments accessible to institutional investors, family offices and retail investors. Only through such regulated vehicles can we open the doors for the trillions of capital from institutional markets to enter crypto.”
Institutions have been making their way into crypto for quite some time which has now starting to include even the big names. However, unless regulatory clarity comes, it won’t reach the potential the crypto market is looking for, at least not yet!
Passionate about Blockchain and has been researching and writing about the Blockchain technology for over a year now. Also holds expertise in digital marketing. follow me on twitter at @sagar2803 or reach out to him at sagar[at]coingape.com