An executive at the $1.5 trillion asset management giant Franklin Templeton says that large institutions are becoming increasingly interested in digital assets.
In a new interview with Scott Melker, Franklin Templeton senior vice president Sandy Kaul says that financial institutions are now looking at crypto following the industry’s deep correction over the past year.
According to Kaul, institutions have an appetite to invest in asset classes that are heavily discounted.
“Institutions hate buying in already rising markets. They want to get positioned when things are cheap and when nobody is really looking at a space. And they have the patience to wait.
And so I think that you have seen a migration of interest from the retail to the institutional side of the equation. And I think that many of the leading institutions in the world, who were the first into hedge funds, who were the first into private equity, who were the first into private debt, they are looking at the crypto domain as the next, as I say, frontier risk marketplace, and they are using this period of crypto winter to begin to put their programs into place.”
Kaul predicts that institutional investments will ultimately form a strong foundation for the digital asset space.
“I think that you’re starting to see that institutional interest. I think that they will come in each time the market falls and put a little bit more on and a little bit more on, and over time that will start to create a good foundation for the markets.
And then when the next bull run really starts to occur and retail interest starts to build again that institutional floor will be under the marketplace. I think that this is a cycle, and we are at the part of the cycle that’s actually super healthy for the long-term growth of the marketplace because these institutions have staying power.”
At time of writing, the crypto market cap stands at $1.05 trillion, more than 66% down from its all-time high of $3.09 trillion.
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