Clients of the bank based in Boston are looking to invest in this new class of digital asset
Asset managers of the American financial services corporation State Street will put “more money into digital assets in 2020”, according to what the company recently announced.
Most of them are interested in digital currencies such as Bitcoin and other cryptoassets for adding it to their portfolios. However, none of the asset managers have pushed for the storage of crypto yet.
Almost 94% of State Street clients hold digital assets or similar products, such as Bitcoin futures. Also, about 38% of the users said they will have more bitcoins in 2020 and 45% said their allocation of bitcoin would stay the same. This is according to a study conducted by the bank through the quantitative analysis firm Oxford Economics.
In this sense, through a statement, Jay Biancamano, Managing Director of Digital Product Development and Innovation at State Street, considers that next year could be positive for the crypto market.
“We are talking to them less about ‘Can you custody this’ and we are more about how we can work together to make sure these changes are not disruptive to our business models”, Jay Biancamano explained during a bank-sponsored event held in New York.
Looking to Store Cryptoactives
He also commented that there will be a clearer idea of what the financial institution plans to do with these assets and their custody next year. Once, establishing that custody, State Street will be looking into fund administration, private placements, and the trading and issuance of this sector.
The bank is having changes. Now, Biancamano’s team focuses on working with clients and third parties around digital asset and tokenization proofs of concept.
“Being able to provide custody and servicing around digital assets is different than building our entire backend infrastructure and prioritizing our technology stack to support Hyperledger blockchain, the Managing Director said.
The team is working on the digital asset and not only in the infrastructure of the project. They go into the business without been worried about the number of DLT engineers to work with, despite having expertise on the staff needed.
“Honestly, institutions already have the ability to invest in these funds. VanEck is doing a private placement. WisdomTree announced the ability to invest on the Swiss exchange. I would like to see regulators become more comfortable with a bitcoin ETF, but I think the ability to invest in Bitcoin in a fund or directly is there”, Biancamano said.
The survey that revealed these results was based on a sample of 101 primarily US-based asset managers and owners. It showed that 62% of clients said tokenization will improve risks but 55% think it will enhance security, whilst 36% considers it will increase liquidity.
However, more than half of the firm’s clients (62%) say this technology will be integrated into their trading process in 2020. Only a half thinks the same about Artificial Intelligence (AI). The majority consider that Distributed Ledger Technology (DLT) will improve financing products.
By María Rodríguez
