Why Institutional Investors Don’t Want To Enter The Crypto World?

Cryptocurrency investors have had a dream. A dream where institutions and investors from big companies would enter in the world of crypto and help fuelling more surges and new developments in the future. But why institutional investors are away from this – and is there hope for them to join the crypto sector?

For the past two years, many crypto media outlets placed heavy emphasis on the need for institutional investors to embrace the cryptocurrency sector. This belief was that institutional inflow would lead to mass adoption and an incredible spike in the value of cryptocurrency assets as a whole.

If we fast forward to present times, we’ll see that the total cryptocurrency market cap is above $250 billion and needs to increase by 200% in order to match the all-time high seen in late 2017. Analysts are wondering why institutional investors won’t enter and make a difference so that BTC positions itself again as a cryptocurrency with massive gains in a 10-year lifespan.

The latest cryptocurrencies news show that the Bitcoin BTC price is nearing the five-digit $10,000 mark for the first time in a while. However, there is an almost infinite sell pressure – mainly because institutional investment is not there to “pump the crypto prices.”

Below, we are listing the three main reasons why institutional investors are refusing to join the cryptocurrency market.

1. The on-ramp remains too steep

First and foremost, investing in Bitcoin remains a hurdle for large mutual fund managers, especially when perceiving their risk of Bitcoin. If we add the additional purchasing steps necessary to this, we will see that the process of buying crypto is definitely off-putting.

2. There is no guarantee of a bull market

Second in our list of reasons why institutional investors won’t join crypto is the fact that there are no guarantees of a bull market. So, these investors are wondering why they should celebrate entering a space which does not guarantee further growth.
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3. The crypto sector is too small

Even though it does not look like this, the market of crypto is just too small. The Bitcoin and altcoin news are followed by millions of people daily and thousands on our website. However, there are other reasons why a $250 billion industry is just too small for a $94 trillion industry (which are traditional markets).

All in all, we can say that there are some big companies embracing crypto technologies already – and that we are seeing an uptick in developments. However, all of this needs to happen on a wider scale so that we could see institutional money flowing on the markets.