Top 5 reasons big institutions will never go big in crypto
1- They don't need to.
JPM was the 6th most profitable company in the world in 2018 according to fortune.
They made $32.4 billion net profit (109 billion in revenue). They have 2.7 trillion worth of assets.
Turning 10 million into 1 billion in 5 years which is the dream of many, they won't even notice.
2- They have to set up a whole department, risk management, traders, etc, just for 1 small market.
Without the wash trading the entirety of crypto volume is about 3 billion (including bitmex I think), remove all the micro coins not worth looking at, and they have access to 2 billion volume maybe.
The market cap of the whole thing is a few hundred billions. Sell orders of 1000 BTC drop the price by 15%... Rofl...
Then half of it gets taxed and 2/3 of whats left goes in salaries and fees...
3- It is the wild west and a huge ponzi like it or not.
Half of the 2015-2017 bull market was attributed to 1 manipulator using Tether. Before that the Willy bot was pumping prices.
And 95% of crypto volume was proven to be fake. And MtGox got hacked. So many scams so many complications.
They'd have to create a wallet and if they want to sell every one will know. So create wallets. They get 1000 times a $50 transaction or maybe worse.
And it could take hours for them to transfer their BTC.
And they would need several brokers to affect the price as little as possible.
There are just so many complications.
4- The majority of Institutional Investors are looking for income & minimum returns. The rare ones that want big returns have no incentive or cannot join.
Bitcoin pays no interest. Already it is something they are not used to.
And the prime role of those institutions is not to look for maximum returns.
They just want some minimum level of return then more is bonus they gladly welcome if it does not come with increased risk or low liquidity.
Bitcoin has wild 80% moves in both directions. And it would be hard for investors to get their money out. It's just not their target. It's an inferior investment to what already exists.
You can forget about pension and mutual funds immediately. The biggest 2.
The "crazier" ones are hedge funds, and there are some in crypto. They are suspected to manipulate prices (so risk ending in front of a judge), and many ended up with 80% losses and such.
Existing hedge funds that are successful are looking to scale up on bigger markets, not scale down lol what are people thinking.
And the unsuccessful ones can't get clients, and why would anyone invest with a loser that now is going to gamble his last chance in crypto?
Even with all the hype from 2017 very little funds were able to get started. Just a couple randoms with no previous experience, that are popular with "the masses" usually made of young gullible delusional dumb money, and managed to gather a few millions to "invest" (take their 2% fee and then flip a coin investors take all the risk).
5- They care about their reputation and emm... what do you think... They don't want to go to jail duh!
Maybe this is the biggest one. They have all to lose and nearly nothing to gain. This one is obvious...
Especially recently, after 2008, they have spent enough time in front of judges or members of parliament to want to go gamble on magic beans.
They get roasted by senators for exposing their investors to a company that ended up going bankrupt. They are held accountable for everything.
Some legit, or that seemed legit, company, regulated, that filled all the paperwork, all they do is let their investors touch it, and if tough luck it goes to zero, that's it, there is a hearing with the government.
Imagine if that happened with a virtual currency made out of thin air with no legal ties, no one in charge, no regulation, nothing.
Especially with every one angry after 2008. They'd get sentenced to death!
Risk death to make 0.25% mmmyeah they are NEVER going to go into crypto if they have half a brain.
1 counter argument no one ever cared about, but they will start caring about once the shills tell them it will bring institutions in: in 2020 CME is launching Bitcoin options.
Crypto "investors" care about ONE thing and ONE thing only: reasons for price to go up. They care about NOTHING other than this, it's insane.
There's probably going to be another risible "bull market start" in early 2020 with CME options and The Halving™
JPM was the 6th most profitable company in the world in 2018 according to fortune.
They made $32.4 billion net profit (109 billion in revenue). They have 2.7 trillion worth of assets.
Turning 10 million into 1 billion in 5 years which is the dream of many, they won't even notice.
2- They have to set up a whole department, risk management, traders, etc, just for 1 small market.
Without the wash trading the entirety of crypto volume is about 3 billion (including bitmex I think), remove all the micro coins not worth looking at, and they have access to 2 billion volume maybe.
The market cap of the whole thing is a few hundred billions. Sell orders of 1000 BTC drop the price by 15%... Rofl...
Then half of it gets taxed and 2/3 of whats left goes in salaries and fees...
3- It is the wild west and a huge ponzi like it or not.
Half of the 2015-2017 bull market was attributed to 1 manipulator using Tether. Before that the Willy bot was pumping prices.
And 95% of crypto volume was proven to be fake. And MtGox got hacked. So many scams so many complications.
They'd have to create a wallet and if they want to sell every one will know. So create wallets. They get 1000 times a $50 transaction or maybe worse.
And it could take hours for them to transfer their BTC.
And they would need several brokers to affect the price as little as possible.
There are just so many complications.
4- The majority of Institutional Investors are looking for income & minimum returns. The rare ones that want big returns have no incentive or cannot join.
Bitcoin pays no interest. Already it is something they are not used to.
And the prime role of those institutions is not to look for maximum returns.
They just want some minimum level of return then more is bonus they gladly welcome if it does not come with increased risk or low liquidity.
Bitcoin has wild 80% moves in both directions. And it would be hard for investors to get their money out. It's just not their target. It's an inferior investment to what already exists.
You can forget about pension and mutual funds immediately. The biggest 2.
The "crazier" ones are hedge funds, and there are some in crypto. They are suspected to manipulate prices (so risk ending in front of a judge), and many ended up with 80% losses and such.
Existing hedge funds that are successful are looking to scale up on bigger markets, not scale down lol what are people thinking.
And the unsuccessful ones can't get clients, and why would anyone invest with a loser that now is going to gamble his last chance in crypto?
Even with all the hype from 2017 very little funds were able to get started. Just a couple randoms with no previous experience, that are popular with "the masses" usually made of young gullible delusional dumb money, and managed to gather a few millions to "invest" (take their 2% fee and then flip a coin investors take all the risk).
5- They care about their reputation and emm... what do you think... They don't want to go to jail duh!
Maybe this is the biggest one. They have all to lose and nearly nothing to gain. This one is obvious...
Especially recently, after 2008, they have spent enough time in front of judges or members of parliament to want to go gamble on magic beans.
They get roasted by senators for exposing their investors to a company that ended up going bankrupt. They are held accountable for everything.
Some legit, or that seemed legit, company, regulated, that filled all the paperwork, all they do is let their investors touch it, and if tough luck it goes to zero, that's it, there is a hearing with the government.
Imagine if that happened with a virtual currency made out of thin air with no legal ties, no one in charge, no regulation, nothing.
Especially with every one angry after 2008. They'd get sentenced to death!
Risk death to make 0.25% mmmyeah they are NEVER going to go into crypto if they have half a brain.
1 counter argument no one ever cared about, but they will start caring about once the shills tell them it will bring institutions in: in 2020 CME is launching Bitcoin options.
Crypto "investors" care about ONE thing and ONE thing only: reasons for price to go up. They care about NOTHING other than this, it's insane.
There's probably going to be another risible "bull market start" in early 2020 with CME options and The Halving™
Comment:
See what I mean? Now we learn that china pencil pushing dictators after making positive statements to flush out crypto enthusiasts stormed binance office, and declared they would immediately destroy every crypto exchange in the coutry or something like that.
I think this happened a few hours after my update, its like they do it on purpose to piss me off.
Does not piss me off. Makes me laugh.
I warned this would happen. No one listened. They laughed.
Hordes of people fell for china bait.
Dozens of exchanges opened illegally there because they got confident, and how many millions of crypto investors fell for it?
Out in the open now... like sitting ducks.
The bloodshed will be fun.
I heard cz from binance was not as cocky anymore and on the run.
I hope they arrest him. Lets see who is laughing then.
Dumbasses.
I think this happened a few hours after my update, its like they do it on purpose to piss me off.
Does not piss me off. Makes me laugh.
I warned this would happen. No one listened. They laughed.
Hordes of people fell for china bait.
Dozens of exchanges opened illegally there because they got confident, and how many millions of crypto investors fell for it?
Out in the open now... like sitting ducks.
The bloodshed will be fun.
I heard cz from binance was not as cocky anymore and on the run.
I hope they arrest him. Lets see who is laughing then.
Dumbasses.
- I have 2 Bitcoins, I buy things with them over a year. They ask me to keep every single receipt and note bitcoin price at the time of purchase every single time, calculate how much it went up and declare my "gain"
- Millions of people go on vacation, they convert their currencies into foreign currencies, they are never expected to declare every foreign exchange tick. Poeple are buying all day long, eating out, they are not looking at the Forex market 10 times a day for taxes...
These toxic pencil pushing bureaucrats are making it impossible for Bitcoin or any crypto to compete with their pyramid scheme, inequality creating, the cause for Hitler & Stalin, excrement fiats.
Politicians never provide any benefit. All they do is destroy and get in the way of progress.
We really should get rid of them.