The institutional adoption of digital assets within Asia has taken a promising turn, thanks primarily to improved regulatory clarity. Key adoptive regions include South Korea, Hong Kong, Japan, and Singapore, all embracing opportunities in the crypto space, as reported by TechCrunch. This encouraging development has emerged despite previous setbacks to the industry, such as the downfall of Terra/LUNA and the bankruptcy filing of FTX.
Asia is proving to be more open than the United States and Europe towards institutional adoption, as the former tends to delve proactively into digital asset education. Justin Kim, the Head of Korea at Ava Labs, remarks that other regions prefer to adopt the ‘wait and see’ approach.
Regulators in Asia are progressively green-flagging crypto businesses, cultivating a promising environment for institutional investors. Charles d’Haussy, the CEO of the dYdX Foundation, notices an increasing number of crypto regulatory approvals in Asia, corresponding to a surge in institutional demand for cryptocurrencies. Particularly, Hong Kong is evolving to be a ‘super friendly’ crypto regulatory zone with the potential to eclipse Singapore due to its substantial financial industry and firm connectivity to mainland China.
However, inconsistencies in institutional adoption are observed across Asia. Singapore has been a frontrunner in achieving substantial progress in institutional international adoption, closely followed by Korea and Japan. South Korea, despite its more regulated setting toward market makers and liquidity providers, reflects a robust demand for blockchain solutions among larger institutions and corporations.
For these entities, the primary concerns involve acquiring access to licensed custodians, a deep liquidity pool, and managing counterparty risk. They are eager for the approval of a bitcoin spot ETF in the United States. Eric Anziani, the President and COO of Crypto.com, anticipates this approval to stimulate adoption and become a significant attraction for investors in the upcoming year.
Meanwhile, there’s a rising demand from institutions in general and enhanced market assurance compared to the previous year. Among family offices in Asia, particularly the younger generations, there is a trend towards allocating capital toward the crypto market.
Despite some bumps along the route, marked by events like the Terra/LUNA collapse and some corporate bankruptcies, the digital asset market’s infrastructure has remarkably fortified. The launch of PayPal’s stablecoin, PYUSD, further underscores this increasing market maturity. Nonetheless, the future of blockchain and crypto in Asia, while promising, will still depend heavily on regulatory dynamics and market developments.
Source: Cryptonews
