May 8, 2018 Article

How Institutional Investors are Grabbing their Share of the Cryptomarket

Over the past few days, we have seen institutional investors like family offices, venture capital and even royalty funds – enter the cryptocurrency market. George Soros officially issued an internal approval for his $26 billion fund, Soros Fund Management, to trade cryptocurrencies.

But Soros isn’t the only one who has developed interest in the crypto market. Venrock, the Rockefeller family official venture capital arm has also joined forces with Brooklyn-based cryptocurrency investment group, CoinFund, to invest in cryptocurrency and other related projects.

In Europe, the Crown Prince of Liechtenstein, His Majesty Alois Philipp Maria, made public his interest in buying Bitcoin and other cryptocurrencies as a family investment. Will this trend continue?


Getting a Piece of the Cake

From here on, we are likely to hear news that other institutional investors, including mutual funds, insurance companies, pension funds, endowments, hedge funds, investment banks, hedge fund investors, REITs and commercial trusts, have joined the crypto bandwagon.

Despite the recent crypto ads ban by tech giants, Facebook, Instagram, Twitter, LinkedIn, as well as the Google’s ban which will be implemented by June 2018, institutional investors will scramble for their piece of the cake as application of cryptocurrencies and blockchain widens.

According to Vincent Lim, CEO at Fanfare Global, blockchain has become a seemingly ubiquitous part of our lifestyle, from health to sports to social commerce.

He says, “As with every sector and industry, there will come a time for renewal, transformation and change. With institutional investors’, the time has arrived. The wise ones are not just jumping on the bandwagon, but they are also strategically positioning themselves to carve out their share of the spoils.”


Not a flash-in-the-pan idea

Despite the ups and down the cryptomarket is experiencing, particularly in the first quarter of the year, its resilience has proven that it’s here to stay. ICO scams and impending regulations cannot deter the growth of the cryptomarket.

Piers Mana, Systems Architect and Founder at Roux.io, says, “Time has told that cryptocurrencies are not a flash-in-the-pan idea, as many once feared. While the market has had its bumps and bruises over the years, there is still a market! I am sure that as more investors familiarize themselves with the technology adoption will continue to increase.”

On his part, CoinZoom founder and CEO, Todd Croslands feels the flow of institutional funds into the cryptocurrency space goes to affirm that digital currencies are indeed getting mainstreamed in the financial sector.

He says, “Soros once bet against the British Pound and almost broke the Bank of England. In the process he made $1 billion. Soros Fund Management entering the space is a further validation that cryptocurrencies are becoming more mainstream for Institutional investors. This follows the CME and the CBOE as well as other large institutions.”
 

 Disclaimer: David Drake is on the advisory board for most of the firms mentioned or quoted in this article.