Jimmy Coates, a crypto market analyst at Bloomberg Intelligence, argues that “lies” and “fear of the unknown” are what prevents traditional portfolio managers from investing in cryptocurrencies.
Speaking to Cointelegraph during the Australian Crypto Convention over the weekend, Coutts said there has been a persistent “mistake” that “there is no intrinsic value in blockchains.”
Coates explained that “asset managers own stocks, such as Amazon and Facebook […] which these companies did not turn a profit in the first several years,” adding that in its early stages Facebook “had no profit […] or was seen to have any intrinsic value:
“However, they can understand that there is value to the network here, that the network is growing, and the value of the asset builds up from the number of people using the products.”
Coutts believes that “although all blockchains are cash-generating assets, including Ethereum,” there is certainly intrinsic value there.
However, the Bloomberg analyst said he could not pinpoint the reason for the reluctance to adopt the cryptocurrency, ruling out a lack of regulation as the reason:
“Regulation cannot be one of them. Let me just repeat that. Regulations are always a concern, but BTC is regulated.”
“There is really no regulatory risk,” Coutts said, with crypto being “instant” regulated and becoming a taxable item that you have to “disclose to the tax authorities in whatever jurisdiction you are in.”
Instead, Coutts said it could be “just a fear of the unknown,” adding that ignoring asset managers or choosing not to educate themselves about cryptocurrency is a missed opportunity.
Coutts suggested that those reluctant to invest in cryptocurrency should look beyond market volatility and focus on what cryptocurrency actually brings to the table.
“The best thing we can do is understand the global trends that are taking place […] the degeneration and technological innovation, in which crypto is located. This provides the impetus behind the sails of cryptocurrency as an asset class that must be taken into account in some customization.”
Jimmy Coates speaking at the Australian Crypto Convention on September 17
Last month, Picket advised the Swiss wealth management group not to invest in cryptocurrencies “amid the recent industrial turmoil.”
Picket Group CEO Tee Fong acknowledged that crypto is an “asset class we cannot ignore” but does not believe there is “a place for private bankers and private banking wallets.”
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Others suggest that institutional investors are still interested in crypto-related investments despite market conditions.
Apollo Capital’s chief investment officer, Henrik Anderson, told Cointelegraph on September 14 that although institutional interest has been slow to gain momentum, there is a lot waiting on the sidelines, for market timing.
Anderson is optimistic about the future, given that “we’ve already seen a lot of big banks here in Australia taking an interest in digital assets,” with “ANZ and NAB” choosing to focus on “stablecoins and traditional asset tokenization rather than crypto” investments specifically. “