It’s not often as an investor or an operator that you have the opportunity to build something measured in the trillions. The institutional adoption of digital assets represents that scale of an opportunity.
If investors allocate just 200bps of the $73tn of professionally managed assets in the world to Bitcoin, Ethereum, and other “crypto majors,” the institutionally-held digital asset class will cross $1.5tn.
We have hit an inflection point in the building blocks required for institutional participation in the digital asset class. As the attributes of digital assets become fully appreciated, we expect that over the next decade:
- Financial institutions and fund complexes will develop and distribute digital asset products
- Foundations, endowments, RIAs, and sovereigns will look to digital assets as a store of value and macro hedge
- Hedge funds and family offices will find much coveted yield opportunities and structured cash-on-cash returns
- Public and private corporates will look to hold a portion of their Treasury reserves in digital assets as a currency/inflation hedge
While this will not be a “winner take all” market opportunity, the winners that emerge in the institutional digital asset management space will exhibit the following characteristics as exemplified by NYDIG, a fully-licensed and regulated New York-based digital asset manager and qualified custodian:
- Highly tailored digital asset solutions enabling institutional clients to build into positions and construct offensive & defensive strategies
- Seasoned management team and operators with deep capital markets expertise
- White-glove approach to customer service
- Foundationally secure base custody layer and designed to meet the highest regulatory, compliance, and reporting standards
- Full-stack technology solution that has been built from the ground-up
- Strong balance sheet to provide leverage and flexibility to its clients
- A brand synonymous with institutional-grade quality
Read more about our investment thesis: The Future of Institutional Digital Asset Management Has Arrived - Why FinTech Collective led a $50m equity round into NYDIG
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