When we announced Voyager’s retail product, we were overwhelmed by the demand from financial institutions who wanted to use our smart order routing technology to bring crypto to their customers. We’d always planned to launch an institutional arm but quickly realized it was something we needed to prioritize immediately.
As I write this, our Chief Institutional Officer Glenn Barber is explaining Voyager’s value prop to a fellow capital markets professional that’s just entering the crypto world. I’m watching his client’s expression go from confused and skeptical to interested and excited. I’ve seen this exchange occur many times before with individuals from hedge funds to broker dealers (we sit across from each other. Hey, Glenn)!
When I asked Glenn about the state of institutional interest, he said demand is strong.
“Despite the decline in crypto prices, client interest keeps climbing. There are a lot of institutions interested in getting into crypto or offering it to their own customers. And for those already in crypto, they really want what Voyager brings to the table.”
Many others are also noticing an uptick institutional interest. TD Ameritrade Manager of Trading Strategy Shawn Cruz told Nasdaq that his clients are more interested in Bitcoin Futures now that the price of BTC is below $4,000. Cruz also noted that the December down-swing of the NYSE made investors more interested in stashing their assets in BTC.
“It’s really interesting as we’re seeing this volatility in the market... Watching where [money is] flowing out of and where it’s flowing into is something that if you are a market spectator, someone who really likes to pay attention to these rotations in and out of asset classes. Right now, I think you are getting a really enormous amount of data.”
Watch full interview here.
Jeff Dorman, partner at crypto asset management firm Arca Funds, told CoinDesk that after interviewing hundreds of institutions over the last four months he also found the sentiment to be overwhelmingly positive.
Dorman said that the investors he spoke to are mainly looking to use crypto as a hedge against the systemic risks of a financial crisis.
“Crypto offers investors exposure outside of the traditional financial system, and many argue it is actually more dangerous NOT to have some exposure to crypto than it is to have a small allocation.”
Another main reason that his customers are demanding crypto is because they believe in the underlying infrastructure of crypto and its long-term potential.
Regardless of investment strategy, it’s clear institutions and their clients are working hard to understand crypto. The more they learn, the more important it becomes for them to find an allocation for crypto in their portfolios. The crypto winter is turning out to be the perfect storm for institutional adoption.
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