![Bitcoin [btc] and other cryptocurrencies markets are brand new, says sogoloff |](https://ohiobitcoin.com/storage/2019/03/dTOAtv.jpg "Bitcoin [btc] and other cryptocurrencies markets are brand new, says sogoloff |")
![Bitcoin [btc] and other cryptocurrencies markets are brand new, says sogoloff |](http://ohiobitcoin.com/storage/2019/03/dTOAtv.jpg "Bitcoin [btc] and other cryptocurrencies markets are brand new, says sogoloff |")
The entire community has been waiting for institutional investors to step into the space for a long time. This drive grew with announcements made by institutional moguls such as Intercontinental Exchange and Fidelity. However, despite the interest of these institutions, the space is yet to witness a massive by institutional investors.
In an interview with Ran NeuNer for CNBC Crypto Trader, Dimitri Sogoloff, the Founder of Nexyst, spoke about the reason why institutional investors were hesitant to invest in the space.
According to him, institutional investors are worried about the market risks associated with the space, along with associated infrastructure and operational risks.
He went on to say that this is quite different in mature markets as they have already solved most of the risk factors. However, this situation is different from the space as everything is “brand new”.
This was followed by the founder speaking about whether the total risk of the asset class was summed up by volatility and , and infrastructural and operational risks. He said:
“Total risk of any investment including of course crypto investment that part is the most difficult to quantify there is no actual number that you can put to link to an operational risk of any investment.”
He further added:
“With crypto, everything’s brand new so it’s a really tough proposition for a large institution to accept an unknown risk that goes into this formula and then they would really have no idea how much risk is is attached to their investment.”
Furthermore, Dimitri stated that is “a little bit” away from wide by institutions. However, he added that they are going to step in, but there were problems associated with custody, settlement, security, compliance, and regulatory framework. He said:
“No institution is going to deploy a meaningful amount of capital and a meaningful amount of capital means roughly one to five percent of their assets”
This was followed by the host asking about what the numbers would look if 1% of institutional investors portfolio is in . He said:
“The numbers are staggering these are probably 30 to 50 trillion dollars in assets across the world”
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Published at Wed, 13 Mar 2019 05:06:30 +0000
