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New York
23/03/2019
Technology

Digital Assets to Become Part of Mainstream Investment Soon

Despite the rising awareness, many people still confuse between cryptocurrency and digital assets, thereby using these terms interchangeably. A part of the confusion arises from the fact that both of these financial tools can be traded on the same platform and can also be exchanged for one another. In reality, however, these are different and should be considered as separate entities while making investment decisions. That said, a new study released by the Global Blockchain Business Council revealed investors’ believe that digital assets would become part of the mainstream financial trading in the coming years. The same kind of enthusiasm was not found when asked about the probability of the Bitcoin and other cryptocurrencies to achieve the same status. The survey indicates that the investor is optimistic about the prospects of digital assets as one in five investors expects the digital assets to become part of the mainstream trading in 2021. It is indeed a positive outlook; however, its achievement is not going to be easy. The realization of this aim will require clarity in terms of what digital assets the investors are talking about and also whether these digital assets are paired with cryptocurrencies on the trading platform.

Positive Scenario

Even if the industry is unable to achieve on the ambitious expectations expressed by the investors, it is amply clear that cryptocurrency and digital asset space will continue to grow in the future. Reinforcing this fact is the confidence expressed by seven out of ten investors in the sample that digital assets will become a commonly traded entity in the next ten years. This kind of optimism is really telling although it depends on the market and regulatory forces to make this scenario possible in reality.

That said, a small group of investors remains skeptical about the acceptance of digital assets among institutional investors. This group fears that large institutional investors will continue to show a muted response to digital assets as well as cryptocurrencies in the future and making them partake in digital investments is one of the most fierce challenges that the industry and crypto veterans have to address. Commenting on the findings of the study, CEO of the Global Blockchain Business Council, Sandra Ro said that 10% of the total GDP of the world would be in the form of digital assets and cryptocurrencies by 2027. This will translate into trillions of dollars in the assets and obviously, presents a very lucrative opportunity for the investors. Ro, however, cautioned that for achieving this target, a strong commitment from the government regulators and market forces is absolutely required.

Research Limitation

Like other researches, the research conducted by Global Blockchain Business Council has the limitation of a small sample size – a total of 71 institutional investors were interviewed by the study from across the globe. While looking at the bigger picture, this number is quite small and only represents the viewpoint of a minority section. That’s not to say that the findings of the study are a farce or can’t be realized, but just one has to keep in mind that the surveyed sample does not necessarily represent a holistic view of the industry. The future of the financial market will depend on a large number of alternative assets which include both digital assets and cryptocurrencies among others. The growth in the crypto space is contingent on the adoption of a friendly and viable regulatory framework which should encourage its wide adoption among the masses.

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