Unlocking Global Liquidity - Crypto To Enhance The Investment Landscape

The world of investment is changing with the introduction of crypto. As institutions begin to move in, the hype sets the stage for mass adoption and a follow up outbreak of dynamic crypto developments.

This is a global scale development and not a lot of people understand just what this means.

When talking about crypto, its very first attribute comes from its intrinsic design that allows it to be leveraged across the globe, essentially functioning as a channel for financial inclusion and free value flow across international economies.

A worldwide advancement in how businesses set up and grow an investment community is coming to light, or what one might otherwise call “tokenization”, a move for privatized currencies and decentralized business assets management.

Too big of a dream?

Oh well, let's talk about liquidity then.

Access is the keyword

The biggest limitation in the financial world has been its limited access. This has been a programmed rigid system to keep certain classes of people out.

The borderless nature of crypto-fixes is a huge flaw in the financial world, essentially unlocking a global liquidity platform where access is not limited but inclusion is effected by core designs.

Moving forward, we're going to see a lot of crypto side developments bringing better structural buildup to various traditional finance products. One of many that is expected to come through in numbers is crypto-based lending.

It is evident at this point that crypto is a high value asset, even the SEC agrees to this. The Fed chairman Jerome Powell also agreeswith this when he said that crypto has staying power.

Hester Peirce, a commissioner at the SEC has particularly been openly criticizing the SEC’s hesitancy in approving the Bitcoin ETF. All of which are watching, unless they want to simply be delusional, understand the value in crypto and a lot is expected to get built atop of this technology as we advance from here.

Particularly, crypto-backed loans will be massive, the DeFi/CeFi industry is bound to capitalize hugely on crypto’s new found attention for building better lending products.

On November 8, 2023, Investment Adviser Two Prime saw a whopping $2B in Demand for Bitcoin-Backed Loans.

“Since the soft launch of our lending offering on Sept. 13, we’ve been surprised by how much demand there is for crypto-secured loans,” Alexander Blume, managing partner at SEC-registered investment adviser Two Prime, told CoinDesk.

“We have seen about $2 billion in demand for bitcoin-secured loans since we started offering them in September,” Blume said.

It might have been a shocker to him but this volume is low compared to Celsius $20 billion worth of assets under management and more than 1.7 million users at the time of operation.

That said, the revamping of this sector of crypto finance will be great as it would serve as an access platform for individual investments to retain their assets of investments and gain access to liquidity to further expand and the system, at the same time, earns these crypto collaterals of which unlike traditional assets like stocks, crypto assets tend to have a various on-chain yield generation protocols enabling institutions offering these services to grow an interest off their loan collaterals whilst also getting paid the respective interest at maturity.

Posted Using InLeo Alpha