adoption

Corporate Adoption and Trust in Crypto Industry Still in Early Stages

The Big Whale

— 1 min read
  • Corporate adoption of cryptocurrency is still in its early stages.
  • Spot Bitcoin ETFs have brought legitimacy to the industry.
  • Corporate adoption lags behind traditional finance inflows.
  • Mainstream trust in crypto is low, hindering adoption.
  • Corporations are crucial for building trust in the market.
  • Grayscale's Bitcoin Trust ETF has impacted total inflows.

Summary :
Despite the approval of the first spot Bitcoin exchange-traded funds (ETFs), corporate adoption and trust in the cryptocurrency industry are still in their early stages. The regulatory approval of these ETFs was seen as a milestone for the legitimacy of the crypto industry, but according to Marc Degen, co-founder and chairman of Trust Square, corporate adoption is still lacking. Degen compared the inflows of the Bitcoin ETFs with those in traditional finance and highlighted the significant difference. While the Bitcoin ETFs collected around $60 to $70 billion in inflows this year, JPMorgan alone attracted $100 billion in the last 10 years. Additionally, JPMorgan has brought in a record $489 billion in net new client inflows during 2023. This indicates that corporate adoption in the crypto industry is far behind that of traditional finance. The lack of mainstream trust in digital assets is a major reason for this lag in adoption. A study by the Pew Research Center found that approximately 75% of people who are aware of crypto lack confidence in its reliability and safety. Degen believes that corporations are needed to build trust among mainstream users. Currently, new crypto adopters tend to trust centralized exchanges backed by corporations rather than decentralized exchanges. The trading volume on centralized exchanges far surpasses that on decentralized exchanges. While cumulative Bitcoin ETF inflows alone don't provide a complete picture of institutional adoption, it's worth noting that Grayscale's Bitcoin Trust ETF (GBTC) has had a significant impact on the total inflows. GBTC has sold a large amount of Bitcoin, resulting in outflows from the ETFs. Overall, the crypto industry still has a long way to go in terms of corporate adoption and building trust among mainstream users.

Sources :

- CoinTelegraph

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