After Trump's election victory on November 5, Bitcoin has repeatedly hit historical highs, various meme coins have also surged, and even previously overlooked NFTs have come back to life. Have you felt the crazy wave from the cryptocurrency market?
In this frenzy, experts predict that more traditional investment institutions will target this expanding market and launch new products and services. Yes, we're talking about those big shots on Wall Street!
Remember in January this year, BlackRock launched a Bitcoin exchange-traded fund (ETF), causing a stir in the market. And this is just the beginning.
This week, this Wall Street giant launched options for these ETFs, and it started with a bang. And this is just the beginning of the entire market action.
At an event co-hosted by DL News and Eterna Partners last week, these predictions were further confirmed.
At the event, Chris Tyrer, Global Head of Strategy at Bullish, Thomas Restout, CEO of cryptocurrency market maker B2C2, and Arnab Sen, CEO of institutional crypto derivatives trading platform GFO-X, gathered to discuss the future direction of large banks and asset management companies.
They all agree that with Trump's election victory, cryptocurrency exchanges and other businesses primarily serving retail clients are likely to receive more tailored regulatory policies. This will provide these businesses with clearer registration pathways and reduce compliance burdens after registration.
However, those businesses that serve institutions are less worried about regulatory policies, as they have already passed the registration with regulators. After all, if banks do not recognize them, they won't get far.
Taylor is more concerned about whether a more cryptocurrency-friendly U.S. Securities and Exchange Commission (SEC) will pave the way for more digital asset companies to go public. After all, under SEC Chairman Gary Gensler's tough stance, it's almost a luxury for cryptocurrency companies to go public. This has also led to cryptocurrency exchanges like Coinbase becoming one of the few publicly traded companies in the U.S.
"Coinbase is a great company, but they have an unfair advantage," Taylor said.
But now, all of this is starting to change.
Taylor's company, Bullish (backed by Peter Thiel), is one of many that have failed to gain SEC approval for going public, others include Circle, eToro, and Galaxy. Taylor acknowledged that clearer regulatory policies are widely desired, "but entering the public market will bring much greater assistance to the entire industry than we imagine." He added that it will provide more options for professional investors.
For Restout, regulatory policies are also secondary. For smaller businesses like his, the key is whether the SEC can retract its aggressive enforcement agenda. Under Gensler's leadership, the SEC is trying to force cryptocurrency companies, big and small, to comply with securities laws that have been in place for 95 years, originally intended to regulate stocks and bonds.
While giants like BlackRock can easily navigate regulatory hurdles, smaller companies must deal with the risks and costs of compliance.
Even market makers like B2C2 (with annual revenues reaching $3.5 billion) must remain vigilant.
"This is a real, significant shift for participants in our ecosystem. Many of the largest institutions, those looking to enter this field, have already found solutions," Restout said.
Sen stated that although large institutions have shown interest in digital assets and cryptocurrencies, the trading infrastructure has yet to be established.
The missing part is mostly in the market's "pipeline"—the behind-the-scenes functionalities that handle trades and mitigate risks in capital markets.
Large banks provide the necessary services for investment firms to trade any asset class, but they will not fully commit to cryptocurrencies until these components are in place.
But Sen also pointed out that banks are slow to act and lag in technology. "Banks will not change all their traditional technology systems for one asset class, especially for a tiny asset class," he said.
Banks must prove to regulators that they are monitoring transactions to prevent fraud or market abuse and must report trading activities to regulators, while also needing to know who they are trading with.
"This is not appealing, but it is a huge obstacle for this asset class and institutional participants," Sen said.
"Regardless of the scale and scope of trading that institutions want, they want to do it through banks," he added.
"If you can't incorporate cryptocurrencies into your existing collateral agreements and trading agreements... then you can only allow individual, smaller entities to trade on a smaller scale."
For banks, this is about "technology, systems, market structure, and who I am facing from a credit perspective," Sen said.
Nevertheless, Taylor believes that cryptocurrencies are mature enough for major players. In this $3.3 trillion asset class, Bitcoin's total market value has already surpassed that of silver.
"Bitcoin has existed for nearly 15 years without being hacked. And we are still asking if this technology is ready," Taylor said.
"When will people change this mindset? By that time, people are no longer focused on the facts."
Are you ready for the cryptocurrency buying frenzy on Wall Street triggered by Trump's election victory? Let's witness this new era full of opportunities and challenges together!
For more news updates, real-time price analysis and forecasts, and SWAP cross-chain exchanges, please visit: 🤖👉 visit mlion.ai
The above content is for informational sharing only and does not constitute any investment advice! Investment carries risks, and market entry should be approached with caution!
Follow me for daily updates on market information.
