The cryptocurrency market is getting intensely crowded. With the global crypto market cap reaching $1 trillion, it looks like the crypto battlefield has just begun. Over the past few years, one can see institutional investments raining over the crypto industry and pushing demand for blockchain technology even further. The crypto space is hence witnessing a steep increase in attention from various places like governments, banks, and other financial institutions. In fact, the increase in investments from financial institutions has a major role to play in the global market cap of cryptocurrencies reaching $1 trillion. Crypto and Financial Institutions- It Takes Two to Tango Today, the top players of the world are betting on crypto and blockchain technology. It looks like investments are focused in that direction. Having said that, let us first understand the role of institutional investors in the crypto space and vice-versa. The year 2020, was meant to be the year for crypto, and it did not fail to prove it. The crypto industry boomed immensely in 2020. Thousands of businesses went decentralized. In 2020, developers made many instruments that would run with anonymity on the computer and would be free to access. And DeFi made this possible. This led to Ethereum’s price to increase steeply. It crossed many milestones and is soon expected to reach its all-time high in 2021. Seamus Donoghue, METACO’s VP of sales and business development, has recently admitted that many regulatory barriers between the crypto industry and institutions broke down globally in 2020. He also said that crypto regulations have impacted the industry and that the changes brought, have benefited the institutional investors to a very great extent. Why Are These Institutions Giving a Hoot about Cryptocurrencies? It was reported that, by the end of 2020, almost 800 institutional investors will own 36% of crypto assets. In another report by insurance company Evertas, it said that “90% of institutional holders of crypto assets expect to invest even more in Bitcoin in the years to come.” So why such increased attention from financial institutions for the crypto space suddenly? One of the top reasons is that these institutional investors believe, “holding BTC might prove to be less risky than not having Bitcoin exposure at all.” Apart from this, the Office of the Comptroller of the Currency (OCC), recently adopted cryptocurrency and implemented some notable Cryptocurrency Guidance for Banks and the future of payments. Adaptations like these give big hopes to institutions and they end up accepting the industry. Top Financial Institutions Which Supported and Invested in Cryptocurrencies Investments by financial institutions ensured greater access for every individual to the crypto market. It had a good hand in making the world of crypto popular so that it can make its way into the world of digital currencies. Now let’s know about the financial giants which invested in the world of cryptocurrencies. The list is long but here are the top 6 institutions which contributed to the world of digitalization and helped to spread awareness and increase transparency about it. J.P. Morgan Chase & Co. JPMorgan is one of the institutions that has changed its opinion regarding cryptocurrencies, especially Bitcoin. JPMorgan Chase CEO Jamie Dimon used to call bitcoin “a fraud” in 2017. The bullish nature of Bitcoin made JPMorgan go from completely opposing the idea of digital currencies to provide banking facilities to crypto exchanges. The banking giant recently predicted that Bitcoin’s price can go over $146,000. Strategists led by Nikolaos Panigirtzoglou said that cryptocurrencies will get immense popularity and Bitcoin will soon become an alternative to gold. The multinational banking giant has also started to accept Bitcoin Businesses for Banking Services. Coinbase and Gemini, are two mainstream crypto exchanges that have become banking customers of JPMorgan Chase. Back in 2020, Square’s $50 million investment made JPMorgan say it is a “strong vote of confidence for the future of bitcoin.” And according to an article in Bloomberg, JPMorgan said that gold will suffer a lot in the future because of Bitcoin. This statement clarifies how influential Bitcoin has been over the past few years. JPMorgan also is the first U.S. bank that created and successfully tested a digital coin representing a fiat currency. JPM Coin is based on blockchain technology and enables instant transfer of payments between institutional clients. Grayscale Michael Sonnenshein, the newly appointed CEO of Grayscale, said institutional investors are actively investing in cryptocurrencies. Sonnenshein in an interview told Bloomberg: “We’ve started to see participation not just from the hedge fund segment, which we’ve long seen participation from, but now it’s recently from other institutions, pensions, and endowments.” Grayscale is one of the institutions that hold immense assets under cryptocurrencies. According to a tweet, the firm now has $27.5 billion in assets under management. Recently Michael Sonnenshein made another statement saying: “We’ve started … Continued
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