Retail investors have been expecting institutional money to spike the cryptocurrency market. In fact, there are more and more institutions or MNCs are work with the Blockchain space but on developing the blockchain technology itself or through holding equities of blockchain related companies. I will say there will be hardly any upsurge being triggered in the crypto market directly from these factors and I can assure you institutions will not enter the cryptocurreny market shortly under below reasons:
- Institutions will join in the blockchain market sooner or later, but not now. The industry to be honest is far from being developed and quoting what Pantera’s Dan Morehead said,”it is quite clunky for the institutions to step in.” So unless institutional grade custodians are well established, we won’t see massive influx of money into the market.
- Institutions are conservative. This is a fact, institutions prone to earn less in lower volatility rather than losing money in large volatility. With the cryptocurrency market exhibiting large ups and downs, it is highly unlikely for the institutions to join in.
- To be frank, cryptocurrency market is too small. Let’s take a typical 1 billion hedge fund as an example, they can trade almost nothing unless holding bitcoin, let alone saying those multi-billion funds/institutions. So unless the market size is large enough, don’t expect institutions will put in money in the cryptocurrency market.
So guys, stop day-dreaming about institutions pushing cryptocurreny market price further. I am pretty sure you will not able to see that happen in 1-2 years time.
PS: Just in case someone confused, blockchain industry doesn’t mean cryptocurrency market. There are also more reasons but forgive my laziness.
~Pay tribute to the world’s first blockchain fund with their office wallpaper featured. ~
- 首先，我其實認為機構投資者遲早都會進入加密貨幣市場，但現在肯定不會。老實說，加密貨幣行業現在距離完全發展還有很遠距離，引用Pantera的Dan Morehead所說的話就是 “機構要進入加密貨幣非常麻煩。”除非機構級託管人成熟起來，否則我們不會看到大量資金湧入市場。