Jared Gross, a Strategist from the banking giant JPMorgan, recently stated that crypto assets remain virtually non-existent to the majority of the institutional investment world. On an episode of Bloomberg’s What Goes Up podcast, Mr. Gross said that crypto is too difficult to integrate into institutional portfolios, primarily due to its complexity and limited understanding of the asset class among institutional investors. Nevertheless, the mainstream adoption of crypto assets is slowly but surely increasing as more investors become aware of the potential advantages of investing in this asset class.
As an asset class, crypto is effectively non-existent for most large institutional investors. The volatility is too high, the lack of an intrinsic return that you can point to makes it very challenging.
Jared Gross, JPMorgan Strategist
Jared Gross, a JPMorgan Strategist, recently commented that most institutional investors are likely feeling relieved that they didn’t invest in the market when it was surging, and are unlikely to do so in the near future. His comments suggest that the market might be too volatile right now for these investors to take the risk of investing and that they are instead opting to wait until the market stabilizes before entering. This could mean that the market will remain somewhat volatile in the short-term, but could eventually stabilize in the long term.
Most institutional investors probably are breathing a sigh of relief that they didn’t jump into that market and are probably not going to be doing so anytime soon.
Jared Gross, JPMorgan Strategist
However, for Bloomberg’s chief commodity strategist Mike McGlone, it is important for major institutions to invest in the top 10-100 cryptocurrencies, such as Bitcoin and Ethereum, over a five-year time period. By investing in these currencies, rather than the 20,000 highly-speculative cryptos that are available on CoinMarketCap, institutions will be able to build a foundation for their investments. As Gross explains, these currencies may drop in value, but an index that tracks them will ensure that the investments do not suffer too much.
The key thing to remember right now is the Fed is still pounding hard, all risk assets are going down. Cryptos were the fastest one on the way up and the fastest one on the way down.”
Mike McGlone, Bloomberg’s chief commodity strategist