Alpaca Finance Institutional Newsletter #10
Technology-enabled financial institutions continue their push to provide crypto products, with Oanda and N26 opening trading services for their respective customers. This comes at the same time Fidelity enabled custody and trading for ETH, having launched BTC less than a month prior. From monitoring mass market adoption, the question naturally emerges whether these large trusted players will have a positive impact on optics and strike the right chord with investors. Projecting into the future, BTC will likely have continued headwinds, as governments continue to ask whether blockchain energy usage falls within acceptable levels, even if the majority of mining is done outside of country, given the present high cost of energy. At the same time, ETH now moving to proof of stake with a deflationary token issuance model will have an easier narrative for institutions and retail alike.
Meanwhile, regulation will continue to drive how institutions can and will gain exposure to crypto, with a clear sign there is appetite for products outside of long-only BTC and ETH. More products will be granted regulatory approval which should ignite an uptick in activity in ETFs, structured products, and Alternative investment funds (AITs), which offer a wide range of crypto in vanilla and exotic structures.
News
- Most institutional investors hold or plan to buy cryptocurrencies
- Web3 to inject $1.1T in India’s GDP by 2032, following 37x growth since 2020
- Crypto hacks are set to hit all-time highs in 2022
- Turkey taps blockchain for e-Human project, President Erdoğan announces
Regulation
- ‘Secretly circulating’ draft crypto bill could be a ‘boon’ to DeFi
- Japanese regulators loosen crypto laws and make it easier to list coins
- IRS introduces broader ‘Digital Assets’ category ahead of 2022 tax year
- Interpol reportedly creates dedicated unit to fight crypto crimes
Products
- New York-based forex broker Oanda launches crypto trading services in US
- Mobile bank N26 launches cryptocurrency trading with Bitpanda partnership
- $4.5T asset manager Fidelity offers ETH custody and trading to clients
- Shopify partners with Novel to deliver accessible Web3 for merchants
Funding
- Ripple’s $250M fund backs Web3 projects focused on ‘entertainment and media’
- Web3 dev, EVM sharding and crypto banking headline blockchain funding deals
- Binance launches $500M lending project to support crypto miners
- Celestia Foundation raises $55M for modular blockchain architecture
