GROWING INSTITUTIONAL PRESSURE IS DRIVING REGULATOR CRYPTO ACTION
Date
5/15/2024 7:29:42 AM
(MENAFN- Perceptiona) Institutional investors and wealth managers believe their growing pressure for action is driving global regulators to take a tougher stance on the sector, underlining increased acceptance of the digital asset class, according to new global research (1) by London-based Nickel Digital Asset Management (Nickel), Europe’s leading regulated and award-winning, regulated digital assets hedge fund manager founded by alumni of Bankers Trust, Goldman Sachs and JPMorgan.
The study with institutional investors and wealth managers in the US, UK, Germany, Switzerland, Singapore, Brazil and the United Arab Emirates who collectively manage around $816 billion in assets found they believe institutional pressure on regulators is having the biggest impact on regulators’ commitment to taking tough action.
Pressure from institutional investors is seen as having more impact on regulators’ attitudes than recent high-profile scandals such as the collapse of FTX and pressure from the fund management sector. Increased cooperation by regulators is seen as the fourth most impactful factor, ahead of pressure from central banks, governments, and retail investors.
The research found almost all (99%) professional investors believe regulators are committed to cleaning up the sector with 43% believing they are very committed. A similar near unanimity (97%) agree that recent crackdowns such as FTX and Binance are a positive for the sector. Around 22% strongly agree they are positive.
On the specific case of Binance and its former Chief Executive Officer, Changpeng Zhao reaching a settlement with U.S. authorities, which saw Zhao pleading guilty under the agreement there is less support but 79% still regarded it as positive for the sector. However, 95% agree that the settlement with Binance and its former Chief Executive Officer will lead to a safer digital asset sector for investors.
Around 60% of investors questioned believe the US will lead the way in developing more robust regulation for the digital assets sector ahead of 52% who believe Europe will do so and 50% who think the UK will. Just 20% believe Asia will lead the way on the development of digital asset regulation ahead of 18% who believe the Middle East will do so.
The US is also seen as the jurisdiction most committed to developing the digital asset market and becoming a leading global centre – around 63% chose the US ahead of 53% selecting the UK and 37% Germany.
Anatoly Crachilov, CEO and Founding Partner at Nickel Digital, said: “The growing awareness of regulatory standards for the digital asset market for institutional investors underlines the increased interest in the sector.
“That interest will only mature if there is productive regulation and that is highlighted by the strong support for action against FTX and Binance with institutions convinced that regulators are taking the sector seriously.”
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