What is driving institutions to invest in crypto? BlockFi’s David Olsson explains

David Olsson from BlockFi’s global head of institutional distribution shared his thoughts on institutional adoption of cryptocurrency in an interview with Joe Hall, Cointelegraph reporter, April 12. BlockFi, a financial company, offers retail wealth management products, such as crypto-backed loans and interest accounts, Bitcoin rewards credit cards, and bitcoin (BTC) reward credit cards. BlockFi’s platform is available to institutional investors and provides capital efficiency financing, the ability for shorting and hedging, as well as institutional-grade trading infrastructure.

Olsson answered Cointelegraph’s question about the exciting trends among institutional clients who are adopting crypto. He said, “Outside the 80% of Top-50 hedge funds in the globe we’ve spoken with, they all embark on some kind of crypto journey such as opening a trading desk, or investing in crypto native companies run by 25- to 30-year olds that understand how to extract alpha and manage the risk.”

It really is a story of generations. The younger asset managers didn’t have the digital native perspective that a natural digital native would. We see tremendous interest.

Cointelegraph was told by Olsson that many hedge funds had been planning to invest in crypto for a long time, due to the substantial increase in liquidity and institutionalization over the years. Fidelity conducted a survey last year and found that 70% of the surveyed financial institutions intend to invest in crypto within the next year. However, 90% stated they will do so within the next five-years. According to avg., Bitcoin has returned more that 100% each year. Over the past 10 years, Bitcoin has returned more than 100% per year on avg. This compares to about 10% per annum for U.S. equities. It’s becoming just too big in terms mindshare for people not to pay attention,” Olsson said.

“Crypto is able to fix the financial system around the world, beginning with eliminating costly fees from banks.”

Olsson pointed out, however, that not all institutions feel 100% comfortable. This is because jurisdictions with high crypto liquidity don’t always have the regulatory backing them. “In order to increase adoption, you need an institution infrastructure. This means KYC [Know Your Customer], AML[Anti-Money Laundering] mechanism. It means financial transparency, cybersecurity, and all the things clients care about.”

Cointelegraph reported that major investors may still be in demand. Coinbase moved 30,000 BTC on April 15.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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