Institutions have named the main conditions for entering the crypto market


Institutions Have Named the Main Conditions for Entering the Crypto Market

Institutions have named the main conditions for entering the crypto market

Institutions have named the main conditions for entering the crypto market

  • Institutions are still waiting for clarity of crypto market regulation

  • Lack of traditional depositories is a big hurdle

  • Market capitalization is still small

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Consulting firm Aite Group conducted a study that identified the main condition for the entry of institutions into the crypto market

Analytical and consulting firm Aite Group conducted research for eToro to find out the basic conditions for the entry of institutions into the crypto market.

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The survey involved 25 representatives of the financial market, which included banks (41% of the respondents), leading liquidity providers (27%) and depositories (14%). The survey also included fund managers and crypto exchanges..

Industry too new

According to the survey, the majority of respondents agree that the cryptocurrency market is still too immature. High risks, low liquidity and lack of regulatory clarity are cited as arguments.

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According to the respondents, institutions are most hampered by the lack of a regulatory framework in the cryptocurrency market. However, they could not say exactly how the cryptocurrency should be classified or which regulatory body should control its turnover..

The ratio of the use of traditional and cryptocurrency depositories. Source:

Institutions are also looking forward to the emergence of traditional depositories. With their arrival, institutions intend to insure themselves against force majeure, it follows from the survey results.

A double edged sword

Opinions are still divided regarding the volatility of cryptocurrencies. For example, companies actively involved in creating liquidity reserves are more positive about volatility. .

The impact of volatility on institutional interest. Source:

On the other hand, a significant percentage of other respondents, including brokers and depositories, believe that volatility is preventing the massive influx of institutions. Most of the participants agreed that the emergence of large investors will affect the market volatility.  

The Aite Group concluded that the industry is now at a turning point. However, for institutional investors to enter the industry, a number of issues need to be addressed, including regulatory uncertainty, asset safety risks, and relatively low market capitalization..

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