Bitwise CIO: U.S. Regulatory Clarity Could Expose Crypto to $20T Financial Advisory Industry – Blockonomi


TLDR

The
cryptocurrency
market
may
be
on
the
cusp
of
a
significant
breakthrough
as
the
United
States
moves
closer
to
providing
regulatory
clarity
for
digital
assets.

According
to
Matt
Hougan,
chief
investment
officer
at
Bitwise,
a
leading
crypto
asset
manager,
the
resolution
of
legal
uncertainties
could
expose
the
crypto
space
to
the
country’s
$20
trillion
financial
advisory
industry.

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For
the
past
five
years,
regulatory
uncertainty
has
been
the
primary
factor
preventing
financial
advisors
from
increasing
their
exposure
to
cryptocurrencies.

A
recent
survey
by
Bitwise
revealed
that
64%
of
advisors
cited
this
reason
as
their
top
challenge
in
accessing
the
asset
class.
However,
recent
political
developments
in
Washington
suggest
that
the
winds
are
changing
in
favor
of
crypto.

Last
month,
the
House
of
Representatives

passed
the
Financial
Innovation
and
Technology
for
the
21st
Century
Act
(FIT21)
with
bipartisan
support,
including
votes
from
71
Democrats.

This
bill
aims
to
provide
comprehensive
regulatory
clarity
for
crypto
assets
and
companies.
Additionally,
both
the
House
and
Senate
passed
a
resolution
to
strike
down
SEC
guidance
that
prevented
regulated
banks
from
offering
crypto
custody
services,
although
President
Joe
Biden
later
vetoed
the
bill.

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The
SEC
approved
spot
Ether
exchange-traded
funds
(ETFs)
on
May
23,
after
months
of
speculation
that
they
would
be
rejected.
These
developments,
according
to
Hougan,
indicate
that
the
U.S.
is
finally
moving
towards
a
clearer
regulatory
framework
for
cryptocurrencies.

The
potential
impact
of
these
policy
shifts
on
the
crypto
market
cannot
be
overstated.

If
the
regulatory
barriers
are
lifted,
the
crypto
space
could
gain
access
to
the
vast
wealth
managed
by
U.S.
financial
advisors,
estimated
at
around
$20
trillion.
As
Hougan
puts
it,

“Imagine,
then,
how
much
of
that
$20
trillion
will
go
into
crypto
when
the
biggest
barrier
gets
lifted.”

Despite
the
significance
of
these
developments,
the
market
seems
to
be
undervaluing
their
potential
impact.
Hougan
notes
that
investors
outside
of
the
crypto
bubble
appear
uninterested
in
these
news,
as
the
concrete
benefits
of
such
regulatory
changes
are
“too
far
removed.”

He
observes
that
when
discussing
these
political
developments
at
conferences,
“people’s
eyes
glaze
over.”

This
lack
of
interest,
however,
presents
an
opportunity
for
savvy
investors
to
capture
“alpha”
in
the
crypto
market.
If
the
market
were
to
fully
appreciate
the
implications
of
the
shift
in
Washington,
Hougan
believes
that
crypto
prices
would
already
be
at
new
all-time
highs.

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It
is
important
to
note
that
while
the
tide
has
turned
in
favor
of
crypto,
no
policies
have
actually
changed
in
Washington
yet.

The
repeal
of
SAB
121
was
vetoed,
FIT21
is
unlikely
to
pass
the
Senate
before
the
November
elections,
and
the
approved
spot
Ether
ETFs
have
yet
to
launch.

As
Hougan
puts
it,

“The
tide
has
changed,
but
the
water
hasn’t
come
in
yet.
Wake
me
up
when
the
action
happens.”

The
shifting
political
landscape
in
the
U.S.
has
the
potential
to
usher
in
a
new
era
for
cryptocurrencies.
If
regulatory
clarity
is
achieved
and
the
financial
advisory
industry
embraces
digital
assets,
the
market
could
experience
a
significant
surge
in
demand
and
liquidity.

As
mainstream
acceptance
grows,
the
crypto
market
may
indeed
rapidlyy
move
towards
new
all-time
highs.

Go to Source
Author: Oliver Dale


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