Multinational mass media giant Thomson Reuters’ survey of over 400 of its clients suggests that 20 percent of all financial institutions are ready and willing to trade cryptocurrencies. The survey participants that are eager to add digital currencies to their portfolio include hedge funds, large asset managers, and “trading desks at the biggest banks”.
One-fifth of Financial Institutions to Enter the Crypto Space
Twenty percent of 400 participants translates into at least an additional 80 new companies willing to join the cryptocurrency frenzy. The survey highlights that 70 percent of those financial institutions will commence trading in the next six to twelve months.
Moreover, most companies have shown an interest in major coins such as bitcoin, while only a few were inclined towards investing in Initial Coin Offerings (ICOs), despite their continued expansion. However, privacy-focused coins such as Zcash and Monero raised little interest. The survey indicates a wave of positive sentiment towards the crypto space.
The survey also indicated that institutional companies are expanding their areas of interest by adding cryptocurrencies to their interest list, which had previously been limited to the underpinning technology of digital currencies – blockchain technology.
Neill Penney, co-head of trading at Thomson Reuters, told Business Insider:
“Cryptocurrency is still a relatively small part of the trading market, but this survey makes clear this niche segment is starting to enter the mainstream of the financial services industry. This is a major change from a year ago.”
Mainstream Companies Optimistic about Cryptocurrencies
In 2017, interest in bitcoin spiked after prices skyrocketed, attracting mainstream businesses such as the Chicago Board Options Exchange (CBOE) and the CME group. Both CBOE and CME introduced bitcoin futures to their slate of investment products. Bitcoin futures were introduced to attract institutional investors into the crypto space, yet that interest proved thin. The Thomson Reuters survey suggests that institutional investors are starting to become more enthusiastic.
In March, Thomson Reuters Corporation launched a bitcoin sentiment tracker that would monitor 400 crypto-related websites to provide investors better insight into the crypto space. The tracker is said to offer traders an advantage in trading cryptocurrencies.
Despite the renewed institutional optimism, according to the Eurekahedge cryptocurrency Hedge Fund Index, cryptocurrency-focused hedge funds have witnessed a downturn in businesses. Nevertheless, new players are entering, or will be entering, the market.
Tom Lee, well known Wall Street strategist, has predicted the bitcoin price will reach $20,000 by mid-year, and $25,000 by year-end. The influx of mainstream institutions entering the crypto space will only strengthen cryptocurrencies. Companies inclined towards cryptocurrency trading are also keen on introducing new financial instruments relating to the crypto world.
Will the inflow of mainstream companies strengthen the crypto space? Share your views in the comments section.
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