Institutional investment brings new momentum to crypto

Watch: Institutional investment brings new momentum to the crypto-space | The Crypto Mile

Financial institutions are becoming increasingly interested in crypto, fuelling fresh speculation of a new bull-run.

The recent spot bitcoin exchange-traded fund (ETF) filings (BTC-USD) by major fund managers, such as Fidelity (FNF) and BlackRock (BLK) have caused a paradigm shift in how digital assets are perceived by traditional finance incumbents.

Added to this was BlackRock CEO Larry Fink's July interview with CNBC concerning the depreciation of the dollar, and how "an international crypto product can really transcend that".

Read more: Bitcoin rallies to $30,000 after BlackRock's ETF filing

On The Crypto Mile this week, Yahoo Finance UK spoke with Michael Roberts, head of prime at Copper, to delve into the increasing institutional interest in crypto and digital assets.

"The momentum that was lost after the collapse of the FTX exchange in November 2022 is starting to come back. In June, we saw the first month of positive institutional inflows into the crypto space," Roberts said.

He underscored the implications of recent developments from heavyweight financial institutions. "The multiple spot bitcoin ETF filings from major fund managers, such as BlackRock and Fidelity, give conviction to the investment banks that this is an asset class with potential."

Roberts noted the profound impact of these large firms on the investment landscape, suggesting that when a firm like BlackRock shows interest, it essentially paves the way for many others: "A firm like BlackRock getting involved has signalled to investment banks to start looking at bitcoin, and that they should take the asset class seriously."

Read more: Sam Bankman-Fried ‘to break his silence’ over catastrophic FTX collapse

Commenting on bitcoin's evolving reputation, Roberts observed, "Bitcoin is maybe delivering on its promises as a store of value and a protection play." He added that there's now "an element of maturity in the crypto market".

Roberts touched upon the innovative aspects of the crypto industry that are drawing interest from institutional players. He emphasised the tokenisation of real world assets and its potential application to traditional markets. "The real promise of this space is the innovations contained within it," he remarked, referring to the digitisation of tangible assets like equities and bonds.

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Elaborating on the products Copper provides, he stated, "We now have the products to allow our institutional clients to participate in this space in a safe way."

Roberts highlighted Copper's unique selling proposition: offering exchange solutions that hold collateral in a UK trust structure. This, he believes, ensures that "investors can invest in the space and that these assets, which are bearer instruments, are not going to be misappropriated, as they were with FTX".

Roberts also turned his attention to the Asian market, where he sees immense potential. "Institutional interest in public blockchains is big in Asia," he revealed, expressing his surprise at the region's intense focus on the digital asset space. "Certainly, the next bull run could come from Asia," he added.

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