Jamie Coutts, a Crypto Market Analyst at Bloomberg Intelligence, believes that misconceptions and a “fear of the unknown” are holding back conventional portfolio managers from venturing into cryptocurrency investments.
In a recent conversation with Cointelegraph at the Australian Crypto Convention, Coutts pointed out a prevailing misconception that blockchains lack intrinsic value. He highlighted examples of well-known companies like Amazon and Facebook, which initially had no profits or apparent intrinsic value but were still invested in due to their network growth potential.
Coutts emphasized that even though not all blockchains generate cash, such as Ethereum, they do possess intrinsic value. He dismissed the lack of regulation as a reason for hesitation among traditional investors, noting that Bitcoin is already regulated as a taxable entity.
According to Coutts, the primary barrier seems to be a reluctance to embrace the unknown rather than regulatory concerns. He urged asset managers to educate themselves about cryptocurrencies, emphasizing the importance of looking beyond the market volatility and recognizing the underlying value they offer.
Swiss wealth management group Picket group recently cautioned against crypto investments amidst industry instability. While acknowledging crypto as an unavoidable asset class, Picket Group’s CEO, Tee Fong, expressed reservations about its inclusion in private bank portfolios.
Despite the caution from some quarters, other experts, like Henrik Anderson, Chief Investment Officer of Apollo Capital, remain optimistic about institutional interest in crypto investments. Anderson highlighted major Australian banks like ANZ and NAB showing interest in digital assets, focusing on stablecoins and traditional asset tokenization.
In conclusion, despite the uncertainty and hesitancy, there is a growing recognition among institutional investors of the potential of cryptocurrencies as a valuable asset class contributing to global trends in debasement and technological innovation.
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