Investors ‘Absolutely Interested’ in Crypto, Says US Banking Titan BNY Mellon
According to GlobalData research’s banking and payments forecasts for 2023, prominent banks will continue to integrate crypto and digital assets into their offerings despite the ongoing bearish market sentiment.
Michael Demissie, head of digital assets at Bank of New York Mellon (BNY Mellon), is convinced that institutional interest in digital assets will not be dampened by the downturn in the cryptocurrency market last year.
Investors’ love for crypto
Demissie was quoted as saying by Reuters.
“What we see is that customers are absolutely interested in digital assets, by and large”
The BNY Mellon head of digital assets spoke on a panel on cryptocurrency at the recent Afore Consulting 7th Annual FinTech and Regulatory Conference.
During the fintech conference, Demissie referenced a survey conducted by the world’s largest custodian bank last year, which found that 91% – or more than $1 trillion in assets under management – of institutional clients were interested in including tokenized products in their portfolios.
Image: BusinessWorld Online
Robert Vince, CEO of BNY Mellon, once remarked that ignoring cryptocurrencies would be like rejecting the invention of the computer. The fact that this point of view comes from one of the world’s oldest institutions makes it all the more significant.
“Buy and hold”
BNY Mellon’s 2022 assessment also revealed that 86% of institutional players follow a “buy-and-hold” approach, which may indicate that they view the cryptocurrency market as a long-term investment opportunity.
In 2022, cryptocurrency markets plunged as rising interest rates and a series of high-profile crypto business failures worried investors.
Demissie stressed the importance of further industry regulation, as reported by Reuters, in an effort to encourage reliable services that will boost investor confidence.
He said:
“It is important that we navigate this area responsibly.”
BNY Mellon is one of the established banks that has no qualms about dabbling in digital currencies. In 2022, the bank received authorization from New York banking regulators to accept Bitcoin and Ether deposits from select customers.
Great partnerships
In its efforts to provide crypto custody services, the bank is also partnering with US blockchain analytics firm Chainalysis and digital asset custody, transfer and settlement provider Fireblocks.
Stephen Richardson, head of financial markets operations at Fireblocks, claims that banks have already started to integrate digital asset infrastructures into their offerings, despite the ongoing bear market.
This year, both New York-headquartered BNY Mellon and JPMorgan are expected to create additional blockchain-related services.
According to GlobalData’s analysis, platforms like this will enable institutional investors to buy cryptocurrencies like Bitcoin and Ethereum through reputable institutions.
Crypto total market cap at $1 trillion on the daily chart | Chart: TradingView.com
Meanwhile, BNY Mellon recently announced it would let go about 1,500 employees this year, or about 3% of the bank’s workforce.
According to reports, the bank incurred $548 million in expenses during the fourth quarter. BNY recorded $213 million in Q4 charges related to costs, including severance and litigation reserves, it was reported.
-Selected image from pensions and investments
