The crypto markets have been showing a bearish behavior for quite some time now: the last big surge started in December 2017, and everything from January 2018 to this point has been either decline or a notorious inability to swiftly recover. Bitcoin, for example, went from being worth more than $19,000 a year ago to the $3,500-$3,600 range today.
In order to re-establish its value, several things need to happen. Awareness needs to keep growing for cryptocurrencies and blockchain to reach a truly worldwide status, and institutions need to invest heavily for the market to have a chance at a long-awaited revival.
Patrick Springer, a former Morgan Stanley managing director and current advisor for
Suffering the Consequences of the Collapse
“The demand for bitcoin futures and ETFs by core institutional investors has still not been determined yet,” Springer told a recognized crypto news site. “The damage from the crypto meltdown in 2018 plus the numerous regulatory issues will take time for the market to digest.”
He also states that “incumbents in trading, settlement, and payments already have such large market shares and current systems are reasonably efficient for existing uses that there is not a lot of incentive to be an aggressive first-mover.”
One needs to wonder why would a person or an entity enter the blockchain universe amid the current chaos when it comes to the primary crypto assets’ price. Springer, however, defends these investment opportunities and he says that blockchain-based securities are for real. “There is increasing confidence in stablecoins, and there will be new types of blockchain securities for investors to look at. Tokenized assets, meaning digital tokens of real assets will begin, creating opportunities in many different types of asset markets,” he observes.
The Tokenization of Assets
With decades of experience working with institutional investors, Springer is an authorized source. He expresses full confidence in a change for the best, and identifies the tokenization of assets as a primary reason behind that. “Institutional and accredited investors will be attracted to an emerging asset class of tokens that provide ownership interests more easily or provide streams of income in a secure manner. Over time, bulge bracket players will look to provide investment solutions for their clients. Fidelity’s commitment and movement in the space is something to keep an eye on.”
Springer spots digitization of equities as the real game-changer for the current financial landscape. “There is an enormous opportunity to make different types of real estate investments available to more investors — and at the same time to make more financing channels available to real estate developers of all sizes.”
He emphasizes that the process of digitally encrypting every element that a smart contract should exercise governance will be of great help in decreasing market frictions. “Listing titles, licenses, and others on a global marketplace where more investors can evaluate, value, and transact more seamlessly will lead to better capital allocation and a more efficient economy.”
Other experts and authorized voices around the community have provided their opinion on the market. For example, Anthony Pompliano, from Morgan Creek, has said that “every asset in the world will be tokenized,” and has listed equity in public and private companies, real estate (personal and investment,) debt funds, venture funds, high value collectibles, and public infrastructure projects as some of those elements.
By Andres Chavez