Dan Morehead believes that Bitcoin ETF at this point is not going to happen. And though he believes that there will be another bull run, he believes that it isn’t even happening this year. He shares the same opinion as former Goldman Sachs partner Mike Novogratz in his view of Bitcoin.
For Mike Novogratz, his Galaxy Digital which is a crypto merchant listed on Toronto-based stock exchange TSX-V is now the first alpha crypto custody client of Fidelity Digital Assets.
Fidelity is the world’s fourth-largest asset manager controlling around $7.2 trillion in assets as of October 2018. Fidelity decided to launch a new company that is focused on getting institutional investors involved in the industry. This company is going to provide crypto custodian solutions to institutional investors and accredited investors alike.
What makes Fidelity such big news in the crypto world is the fact that its 27 million customers and 23,000 businesses will have access to infrastructure and services that allow them to dabble in cryptocurrencies.
Hedge Funds and Institutions
CEO Abigail Johnson mentioned that part of the long-term goal of the company is to increase the access to cryptocurrencies. She said that “Our goal is to make digitally-native assets such as bitcoin, more accessible to investors. We expect to continue investing and experimenting, over the long term, with ways to make this emerging asset class easier for our clients to understand and use”.
Among those that are targeted by Fidelity included hedge funds, pensions, and even academic institutions that are willing to invest in the crypto market. In fact, this can become a trend. It has been reported earlier this month that Yale CIO David Swansen ventured on cryptocurrencies.
Demand from Institutional Investors
According to Fidelity Digital Assets founding head Tom Jessop, the reason behind the company focusing on digital currencies is due to the demand from institutions for cryptocurrencies. In fact, you already have ICE working together with Microsoft and Starbucks to have Bakkt.
Within less than 24 hours since the launch of Fidelity Digital Assets, the company was able to secure Galaxy Digital as its very first custody client. Galaxy Digital has similar objective as Fidelity which is to provide cryptocurrencies for institutional investors. According to Jessop: “This is a recognition that there is institutional demand for these assets as a class. Family officies, hedge funds, other sophisticated investors, are starting to think seriously about this space”.
2018 was filled with different regulatory changes. And though the crypto market has been down for the last months, many are still quite confident that it is only a matter of time before institutional investors dabble in the crypto market.
Regulatory clarity is believed to be the missing piece for the participation of institutional investors. Also, there are those that are quite hopeful regarding the possibility of a Bitcoin ETF getting approved. The Bitcoin ETF application by VanEck and SolidX is believed to be the one that has the strongest chance of getting approved by the US Securities and Exchange Commission. Are we going to see more institutional investors in the coming months?