Cryptocurrency Market Expected to Transform into an Asset Management Industry

Author: COINTURK NEWS

Bernstein, the investment giant, released a recent research report stating that the launch of spot-based Bitcoin exchange-traded funds (ETFs) in the US is expected to attract more capital to the market and transform the cryptocurrency market into an officially regulated asset management industry managing over $500 billion in assets in the next five years.

In its latest report, Bernstein expects the cryptocurrency fund management business to make a significant breakthrough following the approval of spot Bitcoin ETFs in the US. The investment giant stated that the revenue of the cryptocurrency fund management business could reach approximately 4% of the current market value of the cryptocurrency market, amounting to $50 billion. Currently, the total value of the cryptocurrency market is $1.08 trillion.

According to the report, analysts at Bernstein led by Gautam Chhugani expect the cryptocurrency market to transform from a summer industry managing $50 billion in assets to an officially regulated asset management industry managing $500-650 billion in assets in the next five years.

Mainstream Gateway: Spot-Based Bitcoin ETF

The research comes months after BlackRock, the world’s largest asset management company, applied to the US Securities and Exchange Commission (SEC) for a spot-based Bitcoin ETF. Earlier this month, the regulatory agency postponed its decision on all spot ETF applications to October. The cryptocurrency market expects the approval and launch of spot-based ETFs to be the gateway to mainstream money.

Bernstein expects the demand to be driven by easier access to ETFs through investment advisors, wealth and private banking integrated products, and direct brokerage accounts. The report suggests that this could mean a 10% ETF share for Bitcoin (BTC) and Ethereum (ETH) in terms of market value, and a 5-6% share for crypto hedge funds.

The report concludes, “The adoption of the cryptocurrency market follows hype cycles, and we expect significant adoption starting from 2024, which is the regulatory year marking the turning point with the approval of ETFs.”