Crypto adoption continues to grow each year as proponents recognize the economical advantages on offer. The biggest threat to its growth? The traditional financial system. Well, the stalwart attitude towards digital assets is slowly changing and a new report says that digital assets could become more popular than traditional forms of investments.
According to a report by London-based crypto exchange Bitstamp, 80% of institutional investors believe that crypto as an asset class will overtake traditional investment vehicles in the next decade.
The report’s summary, compiled in consultation with 5,502 institutional investment decision-makers and 23,113 retail investors from 23 countries, also showed that 88% of institutional respondents and 75% of retail investors believe that virtual assets will see mainstream adoption in the same period.
Furthermore, the level of trust among the consulted participants was also high, with 71% of investment professionals and 65% of retail consumer investors stating that they trust crypto. Beyond crypto, the report also said that there were strong levels of trust in stablecoins, CBCDs and NFTs.
Wall Street – “If you can’t beat em, join em”
Traditional forms of investment, such as stocks, bonds, foreign exchange, cash, and real estimate have been around since as early as the 17th century, making up for a combined $100 Trillion economy as of 2021. Although crypto does not directly threaten these markets, the core decentralized aspect does change the way one views foreign exchange – a product that is detrimental to traditional finance. Feeling threatened by this concept, countries and financial institutions have limited crypto trading or outright banned it.
Even so, major Wall Street firms have embraced crypto adoption due to the sheer opportunities at hand. Popular investment banks such as Goldman Sachs and Cowen are expanding crypto offerings to their clients while Custodian banks like BNY Mellon and State Street are partnering with crypto-native companies.
In a report to its shareholders, JP Morgan said,
“With federal regulators in the U.S. and abroad now devising plans for how to oversee the space, the adoption of crypto seems only primed to pick up even more—no matter how strange it once seemed”.
The firm expanded its crypto footprint after announcing an investment in blockchain analysis firm TRM Labs. Notably, JP Morgan became the first bank to enter into the metaverse after opening a virtual lounge in Decentraland.