Two executives at Wave Financial, an asset management firm that provides customized strategies for high net-worth individuals and entities, reported seeing an increase in institutional demand for crypto products amid a bear market.
Speaking to Cointelegraph at the Blockchain Futurist conference in Toronto on Wednesday, Mike Jones, head of business development at Wave Financial, said institutional investment in crypto could be driven by wealth management firms, including Morgan Stanley, Merrill Lynch and Goldman Sachs, which Looking for ways to allow their clients exposure to the space. Jones cited the example of BlackRock’s partnership with Coinbase on August 4, a move that will give users of asset manager Aladdin’s institutional investment management platform access to cryptocurrency trading, custody, prime brokerage, and reporting capabilities.
In addition to wealth managers, Wave exec said venture capital could see “significant growth” in part due to demand for innovative investment vehicles. Gerard Pirelli, Head of Investments and Ventures at Wave Financial, added that giving venture capital clients exposure to cryptocurrencies without going through central exchanges and still dealing with high volume is a “net positive for the industry as a whole.”
“On the investment side of the house, the bear market was kind of positive,” Pirelli said. “Over the past year or year and a half, we’ve seen valuations of a lot of different companies go up incredibly — a little froth, you might say. In the past six months or so, we’ve seen valuations of companies drop to more realistic valuations, and it’s time to start allocating a head Money “.
Blockchain Futurist Conference in Toronto, Canada
“What is encouraging from a market perspective in general is that you think about the last cycle — a few years ago, a lot of the conversation that was surrounding the ecosystem then was: ‘Is this the end of crypto? Jones said. “From an institutional adoption standpoint and from an institutional demand standpoint, the question now seems to be a lot more about ‘Is this the right time to get in?’” ”
“Things are more encouraging, although this is clearly a time of pain. It comes with opportunity as well, especially for people who are building in space.”
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Data from the blockchain appears to support some of Berile and Jones’ claims. Crypto intelligence firm IntoTheBlock reported in March that the number of large transactions on the Cardano blockchain increased more than 50-fold in 2020, indicating “increasing institutional demand.” However, some crypto investment vehicles such as exchange-traded funds with direct exposure to Bitcoin (BTC) have not been approved by US regulators – many said such a listing could attract new investors to the market.