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Managing funds primarily dedicated to crypto is one of the most promising activities in the crypto market. Currently, it is not worth much, especially when comparing its valuation to the overall capitalization of the crypto industry. The dynamism of the latter should, however, benefit it.
Crypto fund management, a growing sector
Despite its current setbacks, the future of the crypto market is not very gloomy, far from it. Indeed, experts believe that this sector is on the verge of a monumental transformation.
This metamorphosis should allow the sector to change dimension. It would then move from its current status of“cottage industry” bringing together some $50 billion in assets to become a truly fully regulated financial machine.
It is in this direction that a recent study conducted by Bernstein Research, a provider of financial data. The firm predicts that the value of crypto assets managed by funds will reach a whopping $650 billion by 2028.
If these projections are correct, these assets would then grow by 1,200% over the next five years! A more than impressive surge, given the current crypto context, but which is based on certain factual elements.
Growth driven by the improvement of the regulatory context
Bernstein Research’s projections are primarily based on recent developments around spot Bitcoin ETFs. The firm is convinced that their approval by the SEC, would be the catalyst for the growth of crypto fund managers. A prospect expected by the crypto community and announced as favorable to the adoption of bitcoin (BTC).
“Crypto finance adoption follows hype cycles and we expect adoption to be hockey stick shaped, with 2024 as the landmark regulatory year for ETF approval”we can read in the Bernstein Research report.
The data provider has also provided some figures concerning the future distribution of ETF market shares. According to him, bitcoin (BTC) and Ethereum (ETH) will capture a 10% share of the capitalization of this market. A total which would be between 5 and 6% for speculative crypto funds.
Ultimately, Bernstein’s research report paints a particularly optimistic picture for the future of crypto fund management. A prospect that could reshape the landscape of the crypto industry, making them a more common and more regulated asset class.
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A graduate of Sciences Po Toulouse and holder of a blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I took the commitment to raise awareness and inform the general public about this constantly evolving ecosystem. My goal is to enable everyone to better understand blockchain and seize the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to relay the latest technological innovations and to put into perspective the economic and societal issues of this revolution in progress.
The comments and opinions expressed in this article are those of the author alone, and should not be considered investment advice. Do your own research before making any investment decisions.