The Data Powering Digital Asset Markets: Top 3 Takeaways

On Thursday, October 19th, David Easthope, Head of FinTech Research at Coalition Greenwich, and Shawn Douglass, CEO at Amberdata, discussed key insights from the report: Digital Assets: Managers Fuel Data Infrastructure Needs. Overall, the research showed that asset managers and hedge funds are optimistic about the growth opportunity of the digital asset class as well as the commercial opportunity to manage more diverse portfolios and build new investment products.

Top Takeaways:

1. Firms are getting quite serious about crypto as reflected by organizational strategies. Twenty-five percent of buy-side firms have a specific digital assets strategy and an additional 13% plan to launch within the next two years. And it’s not just the products behind these strategies. Crypto is increasingly staffed by people—typically seasoned professionals in new and exciting roles. These roles are being staffed up, with almost a quarter of firms with a senior role dedicated to digital assets, reflecting seriousness about implementation as well as senior management buy-in.
   
   
2. The U.S. regulatory environment remains crucial for digital asset investors, but other locations like Dubai and Switzerland also garner support. This surprising positivity towards the U.S. reflects a desire to make the U.S. a place to do business in the longer term.
   
   
3. In the next two years, managers will focus mainly on trading and investing strategies with an emphasis on building new investment products. They believe Bitcoin and other assets can be useful tools against inflation and also see the trading opportunities inherent in this relatively volatile asset class.

In terms of overall crypto market structure, as the industry (particularly in the U.S.) segregates duties across the trade life cycle, implementing investment strategies may involve more specialized partners as vertically integrated firms become scarcer. Greenwich expects to see a full range of services (e.g., news, market data, on-chain analytics, research, and ratings) rise up to support greater implementation of investment strategies. With greater regulatory clarity, the market is poised for sharp growth when the pathway, particularly in the U.S., becomes clear.

Read the report in full, HERE:

A recording of the full discussion is available, HERE: