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In recent times, the cryptocurrency market has undergone significant changes, with family offices in Asia actively exploring the possibility of incorporating cryptocurrencies into their investment portfolios, not just in the United States. During last week's fourth-quarter earnings conference call, Coinbase CEO Brian Armstrong stated that every institution has started holding cryptocurrencies, and this asset class will become an indispensable part of diversified investment portfolios.
In the past year, the total market capitalization of the cryptocurrency market has grown by nearly 80%, reaching $2.1 trillion. Bitcoin and Ethereum have achieved gains of over 100% and 75%, respectively, with the successful launch of the US Bitcoin spot ETF further attracting the attention of traditional investors. This has made cryptocurrencies one of the highly anticipated assets in the investment field.
Moreover, family offices are also eager to ride the wave of cryptocurrencies. Zann Kwan, Chief Investment Officer and Partner at Revo Digital Family Office, stated that Asian family offices not only plan to increase their investment allocation to cryptocurrencies, but even those investors who were originally cautious are now actively exploring how to integrate cryptocurrencies into their portfolios to seek higher returns.
Brian Armstrong believes that the adoption of cryptocurrencies by the financial system is a very positive development, and Coinbase, as one of the most trusted partners, plays a crucial role in this field. He pointed out that Coinbase is one of the custodians for 8 out of the 11 Bitcoin spot ETFs, holding 90% of the Bitcoin assets in Bitcoin spot ETFs. He also emphasized that the launch of Bitcoin spot ETF has unleashed new capital inflows into the cryptocurrency space, making it the second-largest ETF commodity in the United States, surpassing silver.
In addition to accessing cryptocurrencies through ETFs, Armstrong also stated that as more institutions delve into cryptocurrencies, whether through ETFs or other means, they will eventually use cryptocurrencies in other ways, such as including them on their balance sheets, paying suppliers, or using them for payroll. He concluded by expressing hope that cryptocurrencies can provide more impetus to the global GDP, and leveraging every possible opportunity is crucial to achieving this goal.
In the recently released Q1 2024 Crypto Market Outlook, Coinbase collaborated with Glassnode for research, and the results showed that allocating cryptocurrencies to traditional portfolios not only enhances absolute returns but also demonstrates positive trends in risk-adjusted returns. The study involved configuring the Coinbase Core Index (COINCORE) of crypto assets (COINCORE is a market-weighted cryptocurrency index, rebalanced quarterly, primarily composed of eight constituent coins including Bitcoin (65.3%) and Ethereum (28.7%)), showing that without any cryptocurrency allocation, the absolute return was 3.78%, but when allocating 1% to 5% of COINCORE, the absolute return gradually increased to 6.53%. |
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Post time 3-3-2024 05:43:23