Following in the footsteps of Celsius and Terra Luna is Sam Bankman Fried’s crypto firm FTX, another participant in the ongoing crypto catastrophe narrative.
Even while the other two crashes were significant, this one is considerably worse since FTX’s crash snowballed, bringing down other companies with it.
What institutional investors think about the digital currency space after FTX may be gleaned from Laurence Fink’s comments. Fink is the chairman and chief executive officer of BlackRock, an American investment management corporation.
Market analysts are of the opinion that crypto technology will have a significant impact on the financial sector in the not-too-distant future. And Fink concurs with this line of thinking.
Emotions are running high today, fueling widespread selling, which has been compounded by the US Federal Reserve’s decision to raise interest rates, not to mention the FTX disaster.
Many of the investors in FTX are large financial institutions like Blackrock that are testing the waters of the bitcoin market.
Fink recently disclosed on stage at the New York Times Dealbook Summit that most digital currency firms operating today might not survive into the future.
The Gloomy Forecast – What Will Happen To Crypto?
After SBF resigned as CEO on November 11th, FTX filed for bankruptcy.
Since then, the market has been plagued by contagion, affecting businesses such as Genesis and BlockFi, both of which have taken precautions to avoid insolvency or have filed for bankruptcy themselves.
Obviously, this will have a negative impact on the bankrupt businesses. Investors in FTX saw their shares of the company wiped out. In the meantime, Kevin O’Leary has issued a statement calling for regulation following the mess.
Image - Ledger Insights
It can be argued that such words coming from Fink can provide a good insight of the views of institutional investors on crypto firms.
Now, is cryptocurrency a dead fish for institutional investors? Tom Lee, head of research at Fundstrat, believes that Bitcoin and other related asset types are still a viable investment.
Despite Fink’s warnings about suspected misconduct in the FTX meltdown, the crypto industry’s use of blockchain technology still has a place in the future of finance, he says.
Fink has stated that, despite the issues with FTX, he believes the system to be highly vital. He went on to say that he is confident that “tokenization of securities” will usher in the next generation of markets and securities.
FTX former CEO Sam Bankman-Fried. Image: Finews Asia.
Important Insight From Fink
Even though Fink is pessimistic about the market, this still demonstrates that established financial organizations see value in cryptocurrency.
But since the cryptocurrency market has seemingly skipped over the past’s financial lessons, confidence in crypto institutions is low right now.
Fink concurred, saying that it is an excellent time to put money to work. When combined with what Tom Lee said, it’s easy to imagine crypto being around for a very long time.
Crypto total market cap at $814 billion on the daily chart | Featured image from Reuters, Chart: TradingView.com
Source: https://bitcoinist.com/crypto-technology-still-important-ceo/