According to CoinShares Chief Strategy Officer Meltem Demirors, at least eight major US financial institutions are actively seeking to provide their clients with exposure to Bitcoin and cryptocurrencies. These institutions, which include BlackRock, JP Morgan, Morgan Stanley, and Goldman Sachs, have a combined total of $27 trillion in assets under management. However, Demirors noted that this interest from financial institutions is still more of a trickle than a wave, despite recent filings for similar products to BlackRock’s spot Bitcoin exchange-traded fund application.
Although the $27 trillion figure is only an estimation of total assets under management across the eight institutions, it is an indication that institutional investors are showing increasing interest in Bitcoin-related funds. For instance, the ProShares Bitcoin Strategy ETF recently saw its largest weekly inflow in a year, pushing its AUM over $1 billion. This growing interest from institutional investors is fueling optimism within the cryptocurrency community, but there are concerns about the lack of a regulatory framework for digital assets.
In fact, Federal Reserve Board of Governors member Michelle Bowman recently criticized the absence of a crypto regulatory framework, claiming that the uncertainty around the asset class traps institutions in a “supervisory void.” Despite such concerns, however, Clemente, the co-founder of Reflexivity Research, still believes that Bitcoin and cryptocurrencies will see significant investments from institutions in the near future. According to him, between HSBC, Blackrock, Fidelity, and Schwab, there is $25 trillion in assets under management that will soon be enabled to buy Bitcoin.
Overall, the growing interest from US financial institutions in Bitcoin and cryptocurrencies indicates a shift in investment trends, as more traditional investors begin to recognize the potential of digital assets. However, the lack of regulation continues to be a barrier to widespread adoption, and it remains to be seen how institutions will navigate this supervisory void.