Nasdaq-listed cryptocurrency exchange Coinbase has revealed record growth in its institutional business. “This year, interest from pension funds and hedge funds has skyrocketed, supported by the roll-out of crypto-ETPs as well as a growing understanding of the crypto economy,” Coinbase said.
Coinbase institutional investor interest is skyrocketing
Cryptocurrency exchange Coinbase (Nasdaq: Coin) on Tuesday reportedly revealed that between December 31 last year and the end of the first quarter of this year, its institutional holdings grew 170% from $45 billion to $122 billion.
The company currently has over 8,000 institutional clients, including hedge funds, asset managers, pension funds and endowments. Many institutional clients use Coinbase Custody, a crypto custody service with insurance policies for institutional clients. Launched in 2018, the service supports over 90% of cryptocurrencies by market capitalization.
Drew Robinson, Head of Hedge Fund Sales at Coinbase, says:
Over the past 12 months, we have seen a growing interest from institutional investors to take advantage of the cryptocurrency space. However, this year, interest from pension funds and hedge funds has skyrocketed, supported by the roll-out of crypto-ETPs as well as an increased understanding of the crypto economy.
He was further quoted as saying: “Over time we have seen a number of factors pulling institutional investors into the space; these include hedging against inflation, diversification of corporate balance sheets and areas such as payments, payroll and cross-border payments. The digital economy involves a desire for wider engagement. Customer demand is also playing an important role.”
Coinbase is not the only company noticing increasing institutional demand for cryptocurrencies. Goldman Sachs said last month that there is a fear of missing out (FOMO) had driven Institutional Investor for Cryptocurrency. The firm has been saying for months that large institutional demand for bitcoin.
What do you think about Coinbase’s institutional holdings increasing by 170%? Let us know in the comments section below.
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