By Shelly Melancon (Switzerland)
In a current discussion with Bloomberg, Matt Comyn, the CEO of the Commonwealth Bank of Australia, disclosed what he views to be the most significant danger associated with cryptocurrency today. Given the emergence of digital currencies as an alternative investing sector, Comyn believes that the greatest danger associated with cryptocurrency is “missing out.” He added that, even though the cryptocurrency market is highly unpredictable, institutions must strive towards embracing the technology in order to meet customer demand. If this is not done, banks will be forced to withdraw from the market entirely.
Comyn stated that they recognize the dangers associated with participation, but that they believe the risks associated with not participating are worse. The Commonwealth Bank of Australia is the country’s largest bank, and the CEO’s views on the cryptocurrency market come only a day after the bank announced that it had purchased a tiny interest in the US-based cryptocurrency exchange Gemini. Gemini obtained a record-breaking $400 million in its initial investment round, valuing the company at around $7.1 billion at the time. Under the terms of the new collaboration, Commonwealth Bank will function as a custodian for Gemini users.
Major Banking Giants Make Significant Investments In Cryptocurrency
The volatility of the cryptocurrency market appears to be a secondary concern for large financial companies and institutions, which, until a year ago, refused to have anything to do with cryptocurrencies. As of today, banking titans such as JP Morgan, The DBS Group, and numerous others are on a crypto recruiting frenzy, according to reports. These financial institutions are also introducing new cryptocurrency-linked investment products in response to high demand from customers.
Comyn stated that it is critical to emphasize that they do not hold an opinion on the asset class as a whole and that they consider it to be a highly unstable and risky asset. However, they do not believe that the industry or the technology will be phased out at any time in the near future. As a result, they want to comprehend it, and they want to be able to give clients a competitive product that includes the appropriate risk disclosures.
In terms of mainstream acceptance of crypto, 2021 has proved to be a watershed year, as more mainstream companies are expressing an interest in either incorporating crypto or participating in crypto enterprises. A number of cryptocurrency startups, including the FTX cryptocurrency exchange, Chainalysis, Gemini, and Blocfi, have garnered hundreds of millions of dollars in funding this year.
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