Big Institutional Investors not Interested in Crypto: JPMorgan Exec

According to Jared Gross, chief of institutional portfolio strategy at JPMorgan Asset Management, large institutional investors are still pretty much staying away from the cryptocurrency market because the asset class’ uncertainty presents a threat to money managers.

“As an asset class, crypto is effectively nonexistent for most large institutional investors,” Gross explained, adding that “the volatility is too high, the lack of an intrinsic return that you can point to makes it very challenging.”

Most institutional investors, according to Gross, are today “breathing a sigh of relief that they didn’t jump into that market,” which really is not going to happen anytime soon.

The bear market also put a stop to the notion that Bitcoin could be a type of digital gold or an inflation hedge, according to Gross, who stated that it is “self-evident” that this is certainly not the case.

As of this writing, Bitcoin had dropped from $47,700 in January to under $17,000 by the end of December, while Ether had dropped from $3,700 to $1,200 in the same time frame. According to CoinMarketCap, the overall crypto market valuation has dropped from $2.2 trillion to about $810 billion.

Many Institutions Remain Bullish on Bitcoin

Although many institutions are still excluding cryptocurrencies, prominent financial institutions are also gradually adopting it. BNY Mellon, the oldest American bank, said in October that it will protect Ether and Bitcoin for chosen institutional clients.

According to the same investment banking firm’s recent report, approximately 43 million Americans, or 13% of the populace, have possessed crypto assets at some point in their lives. Since before 2020, when it was only approximately 3%, the percentage has climbed rapidly.

As per a December 13 report, this figure has risen significantly since before 2020, when it was less than 3%. The data from JPMorgan comes from tracking over 5 million checking account movements.