The news in the past weeks indicated that a number of institutions are speeding up to expand and offer their crypto-related product. Crypto adoption is on the rise despite a series of recent bloody events.
A new report from the crypto exchange Bitstamp shows a 57% increase in institutional registrations on the digital asset trading platform in November in comparison to those in October.
The exchange revealed to Cointelegraph that its total revenue also surged by 45% during the dramatic month, with 34% of contributions from institutions.
Banks are more open to cryptocurrency and they take this downturn as an opportunity to pour more money into the industry. On the other hand, global retail traders are also gearing toward crypto investment, with a 43% increase in the number of active retail traders.
In the past, banks held a negative stance against Bitcoin and other cryptocurrencies. They focused more on the underlying technologies like blockchain.
Also, financial institutions are among the most heavily regulated businesses because of the size of their operations and their role in the economy. Regulatory uncertainty makes them understandably reluctant to step in.
Jump Ahead To:
Let’s get Real!
Big players’ open stance on crypto trading in recent times shows that the financial industry is being pushed to accept virtual currency as a number of institutional investors, businesses, and fintech competitors gradually pursue this asset class. Obviously, institutions don’t want to be left behind.
Even though the market has fluctuated due to the recent failure of FTX and other notable companies, their interests remain unaffected.
Numerous experts assert that the unfortunate circumstance actually increases regulatory scrutiny, which eventually drives institutional adoption.
Following the collapse of the FTX exchange, which scared investors away from the industry, Goldman Sachs announced on December 6 that it planned to pour millions of dollars into buying or investing in cryptocurrency companies.
According to Mathew McDermott, the bank’s Managing Director, in an interview with Reuters, the FTX contagion has greatly increased the market’s demand for more trusted, regulated crypto institutions, and the big banks have seen their opportunity to get started.
Goldman Sachs and JPMorgan were the first major banks to lead the charge in accepting cryptocurrency transactions.
JPMorgan Chase was officially registered and patented as the “JP Morgan Wallet” by the US Patent and Trademark Office last month (USPTO). The move demonstrates that the financial behemoth remains a leader in providing cryptocurrency and Bitcoin services to its existing customers.
JP And Then Some
JPMorgan recently partnered with Fidelity Bank and Bank of New York Mellon to offer cryptocurrency-related services such as payments and exchanges. Simultaneously, the unit is increasingly focused on finding ways to upgrade and modernize its operations.
A component of this strategy is the acquisition of payments startup Renovite Technologies in order to accelerate the delivery of cloud payment services.
Despite the status quo, the number of traditional financial firms entering the cryptocurrency market has increased in recent months.
In October, VISA filed a trademark application for a crypto wallet, as well as a patent to convert physical fiat money into a digital version. American Express has also recently entered the cryptocurrency market in order to grow its business and reach new customers.
Not only in the United States, but around the world, institutions have become more interested. Sber, Russia’s largest bank, announced in December that the MetaMask wallet and a number of Ethereum-compatible features would be integrated into its offerings.
In addition, the bank intended to launch the first blockchain ETF.
Bitcoin and altcoins were considered too risky for bank customers when they emerged nearly a decade ago from the ruins of the 2008 financial crisis.
Bitcoin, according to JPMorgan CEO Jamie Dimon, is a scam that will not end well. However, the nascent sector has now proven its worth following a series of dramatic events, ranging from the pandemic to the collapses of major industry players such as Terra and FTX.
Perhaps institutions are playing with their money, but we’ve known for a long time that it’s a smart play – they won’t invest in something that is doomed to fail.
The post Report: Institutional Adoption Is On The Rise Despite FTX Collapse appeared first on Blockonomi.