Institutional Dominance in the Mainstream Narrative of Cryptocurrencies
Traditional financial institutions are shaping the narrative in the cryptocurrency space, and these institutions are expected to benefit the most from current trends. Arthur Azizov, founder of B2 Ventures, points out that this market cycle is dominated by institutional investors, exchange-traded funds (ETFs), governments, and stablecoin issuers.
Azizov stated that large banks will accelerate this trend in the near future, and once regulatory clarity regarding interactions with cryptocurrencies is achieved, this process may take only 'a few months.'
"Banks have large user bases, and customers are loyal to them, making it relatively easy to integrate cryptocurrencies into their operations."
These institutions have already changed the market landscape and will continue to do so in a way that is unfavorable to small startups.
As institutional investors, banks, and corporations increase their presence in cryptocurrencies, the tension between traditional financial institutions and crypto-anarchists advocating for a completely decentralized financial system intensifies.
The government is pushing for the institutionalization of cryptocurrencies.
The government also has economic motives to regulate cryptocurrencies in order to attract tech companies, young talent, and fintech startups. This means more focus on anti-money laundering (AML) and know your customer (KYC) requirements, a trend that may gradually take shape in the United States.
This is contrary to the value proposition of decentralized finance (DeFi) which advocates for open access and anti-censorship.
