FTX turmoil increases scrutiny of industry, something institutional investors have been waiting for
The recent liquidity crisis at FTX will increase regulatory scrutiny in the crypto industry, which is what institutional investors are seeking, a number of sources told Cointelegraph on Nov. 10.
"This event will be used as a cornerstone to spark new crypto regulations, which is good for the healthy development of the industry. A more comprehensive regulatory framework has the potential to protect long-term investors from fraud and other risks," stated Julian Hosp, co-founder and CEO of Cake DeFi.
As a matter of fact, October was a relevant month for crypto adoption, as big players in traditional finance announced moves into the digital asset space.
BNY Mellon, the oldest American bank, disclosed its digital custody platform to safeguard select institutional clients’ Ether and Bitcoin. Also, France’s Société Générale bank received regulatory approval as a digital assets service provider (DASP). Finally, Fidelity has expanded retail access to commission-free cryptocurrency trading services.
Developments by global established players are not a coincidence, but rather illustrate a scenario where digital assets are a reality for financial institutions. "It takes deep conviction and significant buy-in for a well-established incumbent to enter an emerging asset class amidst market conditions like we’ve witnessed in 2022," said Sebastien Davies, principal at the digital asset infrastructure provider Aquanow.
Millennial and Gen Z consumers are set to inherit $73 trillion over the next 20 years in the United States only, according to a recent report from Cerulli. By last December, about 48% of millennial households and 20% of all U.S. adults owned cryptocurrency.
"When you combine the spending power of younger generations with the
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