Institutions Cool on Crypto, JPMorgan Survey Finds
“The institutions are coming” – this was a common refrain in the cryptocurrency world a few years ago. While some institutional players, like BlackRock and Vanguard, have entered the market with Bitcoin ETFs, a new report from JPMorgan suggests that the vast majority of institutional investors are staying away. The survey also revealed a sharp decline in the number of traders who believe blockchain is an important technology.
The JPMorgan eTrading survey, conducted annually, polled 4,200 institutional traders. A striking 71% of investors surveyed have no plans to get involved in the digital currency market, while only 13% are currently trading and 16% are considering entering.
Crypto’s Credibility Crisis
Although Bitcoin’s price saw an initial surge after the BlackRock ETF announcement in January 2024, the industry has struggled to find a compelling new narrative. This is partly because of memecoin mania, which has damaged its credibility. The JPM survey included a question about the importance of blockchain technology. Only 7% of respondents said blockchain tech is essential for the future, down from 12% the previous year, signaling a loss of interest.
This decline in interest is perhaps unsurprising. While blockchains such as Bitcoin SV (BSV) can handle a million transactions per second (TPS), and companies like CERTIHASH are revolutionizing cybersecurity, these advancements often receive little attention. Instead, digital currency news often focuses on the latest memecoin pump-and-dumps and any news that might inflate the price of specific digital assets.
Blockchain’s Long-Term Potential
Despite the current market sentiment, scalable blockchain technology possesses a promising future and will likely play a key role in areas such as cross-border payments and mitigating the potential risks of artificial intelligence (AI). While speculative token trading has dominated the past decade, companies and developers who believe in blockchain’s underlying potential have been diligently building solutions. They are beginning to see impressive results.
Recent noteworthy blockchain accomplishments include:
- The Teranode update has scaled the BSV blockchain to one million TPS at minimal cost.
- CERTIHASH has developed advanced cybersecurity tools and is seeking funding to further its development.
- Champions TCG has become a popular physical trading card game that uses scalable blockchain technology.
Ultimately, distributed ledger technology provides significant utility. The coins attached to them are simply the means of writing transactions to the ledger itself. Investors should anticipate continued market challenges for the time being, as the industry continues to grapple with the stigma of memecoin scams. Nevertheless, scalable technology is ready to bring about change in payments, cybersecurity, data management, and more. However, significant interest from professional investors may remain muted for the immediate future.
With major shifts in the economic landscape on the horizon, a more brutal bear market is more likely than the bull market that many have been hoping for.
