Institutions are showing increased interest in crypto despite uncertain markets, emphasizes expert

Institutions are showing increased interest in crypto despite uncertain markets, emphasizes expert

Institutional interest in cryptocurrencies continues to rise

Institutional interest in cryptocurrencies is increasing, although it may not be obvious from the outside. Diogo Mónica, co-founder of Anchorage, a digital assets company, emphasizes that large organizations have increasingly entered the crypto space in the last two years. These organizations have now launched projects that reflect 18 to 24 months of strategic planning. Proof of this is the emergence of Exchange Traded Funds (ETFs) from institutions like BlackRock, which shows that institutions are not shying away from cryptocurrencies even in non-bullish markets.

Mónica also highlights the increasing discussion about the tokenization of real-world assets. Institutions are looking for use cases that meet the interests of both regulators and the public. Focusing on tokenization makes sense as it provides a framework that is accepted by regulators.

One exciting trend that Mónica mentions is the growing interest in Ethereum staking. This interest has particularly increased after the Ethereum Shapella upgrade. While initially less than 10% of all Ethereum holdings were staked, this number is rapidly increasing and is expected to reach 70-80%. Institutions prefer to use staking services from government-chartered banks like Anchorage due to the trust in smart contract risks and regulatory compliance.

According to Mónica, there is still some uncertainty regarding the crypto industry, especially regarding securities regulation. However, Anchorage has taken a proactive approach and created a regulatory framework that allows them to operate effectively even in uncertain times. Mónica believes that increased regulation, regardless of its quality, should be seen as a standard to follow and work with. He emphasizes the need for clear rules from regulators and expresses hope that it will be regulated at the federal level rather than relying on state regulators.

Another topic addressed by Mónica is the challenges faced by crypto companies in the US. As a result, some companies are looking for opportunities outside the country. He cites Europe, Singapore and Hong Kong as examples that have made significant progress in creating regulatory clarity. Mónica particularly praises the European Mica law and the strict regulatory system in Singapore. He also mentions that Hong Kong's stance has changed as regulators now require crypto companies to be integrated into banks.

Finally, Mónica reiterates the call for clear regulations and enforcement processes regarding cryptocurrencies. Concrete definitions of stablecoins and a clear demarcation of regulatory boundaries are needed. Furthermore, regulators must make quick decisions so as not to hinder innovation and delay the industry's progress.

The interview with Diogo Mónica highlights the growing institutional participation in the crypto market and the importance of regulatory clarity for further growth and engagement.