The regulatory landscape around cryptocurrencies is increasingly favouring the ecosystem. For instance, governments are passing laws to encourage firms to offer investors exposure to Bitcoin (BTC), Ethereum (ETH), among other virtual currencies.
Apart from laws, regions like the United Arabs Emirates (UAE) and Switzerland have launched crypto valleys to boost innovations.
In the UAE, for example, the Dubai Multi Commodities Centre (DMCC) established the Crypto Centre to tap into the powers of virtual currencies and distributed ledger technologies such as blockchain.
Germany Greenlights Institutions to Invest in Cryptocurrency
August is a special month for German institutional funds looking to invest in BTC, ETH, and other cryptos.
This is after a law allowing them to do so became effective on Monday, August 2, 2021. The law gives them the freedom to invest as much as 20 per cent of their holdings in crypto.
Notably, funds looking to take advantage of the opening are open to insurers, pension firms, and other corporate clients. German funds whose qualities fall within definitions of the new directive have a cumulative $2.1 trillion of assets under management.
Germany’s move shows a changing landscape where crypto is continually moving to the mainstream. An expert from BIV, Germany’s fund industry body, Tim Kreutzmann, noted that while corporate investors follow “strict regulatory” roadmaps when putting together a portfolio, “on the other hand, they […] also want to invest in crypto.”
A spokesman from DekaBank, one of the leading asset managers in Germany, told Bloomberg that they have “been considering investing in digital currencies.”
Wealthfront Allows Investments in Grayscale’s BTC and ETH Trusts
While Germany’s law increases institutional crypto investors, Wealthfront is boosting retail involvement in the cryptocurrency ecosystem. Wealthfront is a Robo-advisor or an automated investment platform and has more than $15 billion in assets under management.
On July 29, 2021, the platform brought the crypto experience closer to its users through Grayscale’s BTC and ETH trusts.
The Robo-advisor acknowledged that the move helps take away the tedious process of directly interacting with crypto while offering the same benefits.
In an announcement, Wealthfront noted that it has “made it easy to get exposure to Bitcoin and Ethereum right in your Wealthfront portfolio, no wallets required.”
While getting exposure through shares in a trust robs you the excitement of interacting directly with crypto, it helps give those sitting on the fence the chance to have a feel of what they’re missing out on if they invested in crypto.
Asset Manager with $45 Billion of Assets Under Management Adds BTC
While Wealthfront is working to persuade undecided crypto investors indirectly, GoldenTree is already in on the action.
GoldenTree, an asset manager controlling over $40 billion in assets, has added Bitcoin to its balance sheet. According to reports, the firm “has been” accumulating the leading cryptocurrency.
Although the amount it drilled into Bitcoin is yet to be disclosed, GoldenTree joined the list of other notable Wall Street companies investing in crypto.
Reports further revealed that the firm is contemplating hiring gurus in the crypto investment fields. The move is part of GoldenTree’s decision to get more involved in the ecosystem.