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The Wait for Institutional Capital

Over the past couple of weeks, there has been a continuous flow of dribs and drabs of information that speaks to the impending arrival of institutional investors into crypto.

Wall Street reportedly is exploring multiple ways to provide crypto exposure to institutions in a regulatory-compliant way while asset management giant Fidelity (which, by the way, has huge mining operations) plans to launch crypto products by the end of this year. Coinbase is contemplating a Bitcoin ETF and is working with Blackrock. After BitGo received approval for crypto custodianship in North Dakota, market participants feel that the custody piece of the puzzle is finally being figured out. Progress is also being made on building out institutional-grade trading infrastructure and tools for risk management and trade monitoring, something that most of the incumbent trading platforms do not offer. It will be interesting to see how institutional investors will allocate capital to this asset class which is undoubtedly more technical, and distinctly orthogonal compared to the other asset classes. Is it going to be a low-risk all-bitcoin play or a research-driven bottom-up approach aimed at identifying mispriced tokens/currencies. Or even a diversified index-like exposure to top cryptocurrencies through108 Token? (:P)

Team ZenPriveX is in Singapore this week for the inaugural edition of Consensus Singapore. We hope to come back to with you key takeaways from the event and other interesting things we pick from around conference in Singapore in a newsletter soon.

You can read about our Consensus New York round-up here.

Please hit us up if you are in Singapore this week.

Meanwhile in Crypto Wonderland….

“First Crypto Major” In a first, the esteemed New York University has now started offering a major in crypto. The course aims to “establish a groundwork” for students and help them to understand the basics, including legal and business frameworks. The trend in educational offerings mirrors the movement of institutional capital according to Adam White of Coinbase.

“More Power to the Regulators” Texas financial regulator issued cease-and-desist orders against three phony cryptocurrency scams which promise outrageous returns to investors. The bogus projects promised guaranteed RoIs to investors and also misled investors about the profitability of the company.

“New ASIC in town” Bitcoin mining equipment manufacturer Bitfury announced the launch of its latest ASIC mining chip Bitfury Clarke, which can generate up to 120 gigahashes per second. In the future, Bitfury plans to integrate its offerings across mining servers, BlackBoxes and mining facilities. Despite the precipitous decline in crypto prices, mining equipment manufacturers such as Bitmain, Canaan and Bitfury are expanding operations aggressively.

“UK Committee on Crypto” In a paper published yesterday by a Parliamentary Committee of members of the UK Treasury, lawmakers addressed the volatility in cryptocurrency markets and called these markets “the Wild West”. The committee’s words however had a positive annotation, suggesting that the UK could become a leading cryptocurrency hub if it developed a strong regulatory base.

“Hack at Zaif” In yet another hack at a centralized cryptocurrency exchange, $60 million worth of cryptocurrencies were stolen from Japanese exchange Zaif, owned by Tech Bureau corp. After releasing news of the hack, the firm said that it had accepted an offer from Fisco Ltd. to infuse cash to be used for replacing the stolen crypto in exchange for a majority stake.

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