Tag: Institutional Investment

BlackRock to Boost Crypto Access Points through Partnership with Coinbase

by Blockchain News

BlackRock, the globe’s largest asset manager, has teamed up with crypto exchange Coinbase to provide institutional investors with new crypto access points.

Through the strategic partnership, BlackRock’s Aladdin will be connected with Coinbase Prime to provide institutional investors with direct and seamless access to crypto, beginning with Bitcoin (BTC).

Joseph Chalom, the global head of strategic ecosystem partnerships at BlackRock, pointed out:

“Our institutional clients are increasingly interested in gaining exposure to digital asset markets and are focused on how to efficiently manage the operational lifecycle of these assets.”

With assets under management clocking $10 trillion by the end of last year, BlackRock  has emerged as a significant global player to the extent that it has been dubbed the “fourth branch of government.”

Therefore, Aladdin, the end-to-end investment management platform of BlackRock, seeks to boost crypto adoption among institutional investors. Chalom added:

“This connectivity with Aladdin will allow clients to manage their bitcoin exposures directly in their existing portfolio management and trading workflows for a whole portfolio view of risk across asset classes.”

Coinbase prime is the institutional prime broker arm of crypto exchange Coinbase, and it integrates prime financing, advanced agency trading, staking infrastructure, and reporting needed for the entire transaction lifecycle. Supporting more than 13,000 institutional clients, Coinbase Prime will render crypto trading, prime brokerage, reporting capabilities, and custody through the deal. 

As institutional crypto adoption continues to tick, the BlackRock-Coinbase partnership seeks to be a stepping stone toward developing new access points. 

A recent study by the leading investment bank Goldman Sachs showed that 51% of its institutional clients had crypto exposure.

The findings revealed that institutional interest in cryptocurrencies was witnessing strong growth because crypto exposure rose from 40% in 2021 to 51% in 2022, Blockchain.News reported.

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Investcorp Rolls out First Institutional Blockchain Fund in the Gulf

by Blockchain News

Investcorp, a global manager of alternative investment products, has launched the first institutional blockchain fund in the Gulf Cooperation Council (GCC) aimed at propelling a blockchain-powered digital evolution.

Dubbed Lydian Lion, the blockchain fund also has a global investment mandate. It will be mainly rolled out to early-stage companies within the blockchain ecosystem in areas like data analytics, decentralized finance, platforms and exchanges, and blockchain infrastructure.

Gilbert Kamieniecky, the head of Investcorp’s technology private equity business, noted that the fund would be a stepping stone towards more innovations in the blockchain space as the digital economy continues to gear up. He acknowledged:

“We believe that blockchain technology and the ecosystem around it, will transform every facet of our economy much like the internet did in the 2000s.”

Kamieniecky added:

“We have already seen the potential of blockchain to disrupt existing markets and create new ones, such as the meteoric rise of the non-fungible tokens market that in just a few years has grown from under a billion to more than $40 billion.”

As a fast-growing technology area, Hazem Ben-Gacem believes blockchain technology should be accorded more global reach and institutional expertise. 

The Co-CEO at Investcorp added:

“Offering our clients innovative and bold investment ideas, backed by our disciplined and proven approach, has been a key element of our success over the last four decades.”

The GCC is a political and economic alliance of six Middle East nations: the United Arab Emirates (UAE), Kuwait, Oman, Saudi Arabia, Bahrain, and Qatar.

Meanwhile, a recent survey by Goldman Sachs, a leading global investment bank, noted that institutional interest in cryptocurrencies was witnessing strong growth because crypto exposure rose from 40% in 2021 to 51% in 2022. 

Furthermore, inflows into crypto investment products reached $193 million, a scenario that was last seen in mid-December 2021, according to digital asset management firm Coinshares. 

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Shinhan bank Opens Door to Corporate Crypto Accounts, Paving the Way for Institutional Adoption

by Blockchain News

As the first domestic lender on South Korean soil, Shinhan Bank has rolled out real-name corporate accounts to enable transactions from cash to crypto-based on its partnership with cryptocurrency exchange Korbit.

Local regulations made this venture a reality by allowing bank-partnered and licensed crypto exchanges to render cash-to-crypto services. 

Furthermore, the passage of the Reporting and Use of Certain Financial Transaction Information Act extended counter-terrorism and anti-money laundering financing regulations to digital asset service providers. 

The bank acknowledged that it averted such risks through the Shinhan-backed custody service KDAC. 

Digital asset custody is a service that safely manages and stores digital assets owned by various organizations and entities. Therefore, the corporations taking part in the project are chosen by Shinhan Bank and are members of Korea Digital Asset Custody (KDAC).

With the incoming South Korean President, Yoon Suk-yeol pledged of easing crypto regulations; analysis shows the market is on a solid path to being significantly legitimized.

As a result, local banks in the nation intend to ride this wave while seeking authorization to enter the crypto space through their representative body called the Korea Federation of Banks. 

The banks had raised concerns that the crypto market in the country could be monopolized because a “certain local crypto exchange” accounted for 90% of the market share. 

Given that crypto taxation has been a burning issue in South Korea since its parliament tabled a bill in 2020 where cryptocurrency gains would be slapped with a 20% gain, the incoming president vowed to zero tax crypto trading gains not exceeding 50 million won, approximately $40,000. 

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Institutional Crypto Exposure Hits 51%, Goldman Sachs Study Shows

by Blockchain News

Out of 172 institutional clients surveyed, leading global investment bank, Goldman Sachs found out that 51% of them had crypto exposure, according to a report published by Arcane Research.

The survey noted that institutional interest in cryptocurrencies was witnessing strong growth because crypto exposure rose from 40% in 2021 to 51% in 2022. 

Source: Arcane Research

Furthermore, this growth is expected to increase. Per the report:

“Of the 172 surveyed clients, 60% responded that they expect to increase their digital asset holdings in the next one to two years.”

Goldman Sachs eyes rolling out crypto investment services 

Goldman Sachs has been gearing up for the crypto space in recent weeks, given that its website is giving digital assets a keen eye. 

The newly appointed global head of digital assets at Goldman’s private wealth management division, March Rich, recently disclosed that the bank was considering availing a “full-spectrum” of crypto investments through derivatives, physical Bitcoin, or traditional investment vehicles. 

Therefore, Goldman Sachs is edging closer to rolling out its first investment vehicles for crypto assets for clients in its private wealth management group.

Rich noted:

“Some Goldman clients feel like we’re sitting at the dawn of a new Internet in some ways and are looking for ways to participate in this space.”

She added:

“We are working closely with teams across the firm to explore ways to offer thoughtful and appropriate access to the ecosystem for private equity clients, and that is something we look forward to delivering in the near term.”

The bank recently disclosed that it was looking at ways of meeting increasing client demand to own and invest in Bitcoin while still staying on the right side of the law, Blockchain.News reported.  

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Large Institutional Transactions Take the Lion’s Share of Bitcoin Volume at 99%

by Blockchain News

Institutional demand for Bitcoin (BTC) does not seem to be fading based on the large transactions volume witnessed, according to a report by IntoTheBlock.

The study noted:

“Currently over 99% of all Bitcoin volume comes from transactions of over $100k, dubbed large transactions. The dominance of institutions and change in market structure accelerated in Q3 2020.”

Large transactions volume has been the norm in the Bitcoin market since the third quarter of 2020 because they have remained above 90%, per the report.

Institutional investments have played an instrumental role in revolutionizing the BTC ecosystem. For instance, they enabled the leading cryptocurrency breach the then all-time high of $20,000 in December 2020 after three years of waiting.

Since then, Bitcoin has been on a record-breaking streak, with the last historic high price of $69,000 set in November last year. 

IntoTheBlock acknowledged that Bitcoin interest from tech and traditional finance institutions continues to grow exponentially, given that both new entrants and existing ones are not relenting on this asset.

For instance, some of the investments that have taken the crypto world by storm so far this year include Pantera Capital and Bain Capital, raising $1 billion and $560 million for crypto funds, respectively. 

IntoTheBlock also noted that many addresses holding crypto continued going through the roof. The data analytic firm explained:

“Bitcoin addresses with a balance reached a record of nearly 40 million. Addresses holding Ether have outpaced this, with over 70 million having a positive balance of the smart contract platform’s native token.”

This correlates with the fact that Bitcoin hodlers remained unfazed despite the top cryptocurrency recently hitting lows of $34,000 based on accumulating more coins. 

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Bitcoin’s 30% recovery in two weeks has BTC whales back in accumulation mode

by Cointelegraph

Bitcoin (BTC) addresses holding at least 1,000 BTC, the so-called whales, have started accumulating more tokens during the recent market recovery. As of Feb. 10, the total supply in these addresses was 8.096 million BTC versus 7.95 million on Jan. 24, according to data from Coin Metrics.

Bitcoin whales and institutional inflows

The buying sentiment among the richest crypto investors picked momentum during Bitcoin’s recovery in the past two weeks as BTC rebounded from its 2022 low of $33,000 on Jan. 24 to around $43,500 on Feb. 11.

Bitcoin supply in addresses greater than 1,000 BTC. Source: Coin Metrics, Messari

Small Bitcoin investors, addresses that hold less than 1 BTC, so-called “fishes,” also joined the accumulation spree during the recent Bitcoin price rebound.

Meanwhile, data resource Ecoinometrics shows the Coin Metrics data in the form of clusters, showing a synchronous accumulation behavior among the Bitcoin whales and fishes.

Interestingly, the clusters looked the same as they did in the days leading up to BTC’s record high of $69,000 in November 2021.

Bitcoin on-chain divergence. Source: Coin Metrics, Ecoinometrics

“Once more this cycle, this rebound in price correlates pretty well with both the small fish and the whales addresses buying simultaneously for an extended period of time, wrote Nick, the analyst at Ecoinometrics, in a note published Fed. 7, adding:

“I don’t know if this signal is going to continue being predictive of a sustained rally, but hey, for now it is working fine.”

A report published by CoinShares this week also showed a rise in inflow across crypto funds last week. Notably, the capital injections into these funds quadrupled to $85 billion, with $71 million flowing into Bitcoin-focused investment products, suggesting renewed institutional interest is also buoying  BTC’s price recovery.

Net flows into digital assets as of Feb. 4, 2022. Source: CoinShares, Bloomberg

“Right now it is just warming up”

Nick suggested that Bitcoin has enough room to grow its valuation in the coming months, citing a so-called “aggregated risk score,” derived from four parameters that are: risk of overextended market, risk of low-demand, high-supply situation, risk of holders taking profits, and risk of increased selling pressure.

Related: Bitcoin rejects sell-off as 7.5% US inflation fails to keep BTC down for long

The outcome is represented in colors, with red and blue suggesting a hot and cool market, respectively. The hotter the market, the higher the selling pressure.

“Right now it is just warming up,” the Ecoinometrics analyst said, adding that “in theory, there is no obstacle to the price rising much higher except for the lack of momentum.”

Bitcoin aggregated risk level. Source: Ecoinometrics

BTC price levels to watch

Meanwhile, on-chain data tracking planform WhaleMap projected $46,200-$49,000 as Bitcoin’s “current resistance range,” citing higher trading activity inside the price area in the past.

Similarly, the firm noted that the $41,400-$42,400 range is now acting as support, as shown in the chart below.

Bitcoin volume profile. Source: WhaleMap

“Closest on-chain resistance according to whale accumulations is only at ~$47,000,” it noted.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.