Big banks continue to explore Bitcoin and cryptocurrency’s long-term value proposition after shunning the asset class for years.
A lot has changed since I first started covering Bitcoin (BTC) in 2012. A market once relegated to the deepest corners of the internet has now spawned a global revolution that has forced corporations and governments to form an opinion on digital assets. Now, Wall Street is chiming in, with analysts at major banks increasingly convinced that crypto is a maturing asset class with long-term potential.
That was the general takeaway of a new report from Wells Fargo’s research division. The report’s bullish undertones are truly remarkable when you consider how big banks treated Bitcoin just a few years ago. Perhaps they learned not to take cues from Jamie Dimon, whose JPMorgan Chase was outed for massive money laundering in 2020. But please tell me how Bitcoin is so dangerous.
This week’s Crypto Biz explores Wells Fargo’s report and other business stories from the world of blockchain. To get a full breakdown of the top weekly news, register for the newsletter at the very bottom of the page.
Wells Fargo: Crypto adoption could ‘soon hit a hyper-inflection point’
In a report titled “Cryptocurrencies — Too early or too late?” released on Monday, Wells Fargo described the merits of investing in digital assets, going as far as comparing Bitcoin to the internet in the early-to-mid 1990s. While this comparison would usually invoke a recommendation to buy digital assets, Wells Fargo said there’s no reason to FOMO into the market given that the space is “relatively young” and has a lot of room to grow. But the writing is on the wall: the banking giant seems to believe that exposure to crypto is a very, very good investment. As it turns out, Wells Fargo began bending the knee to crypto roughly one year ago:
Banking giant Wells Fargo finally bent the knee and acknowledged Bitcoin as a “speculative investment.” As a business that closed client accounts for using cryptocurrencies, champagne bottles were cracked open afterward. #CryptoYearInReview https://t.co/5kO7PHc3z9
— Cointelegraph (@Cointelegraph) January 3, 2021
KPMG Canada adds BTC and ETH to its corporate treasury
Crypto adoption appears to be on the rise among corporations, with KPMG Canada becoming the latest company to add Bitcoin and Ether (ETH) to its balance sheet. The decision to gain exposure to digital assets was made by KPMG Canada’s governance committee, which includes stakeholders from its finance, risk management and tax divisions. According to managing partner Benjie Thomas, the Big Four tax auditor believes crypto is a “maturing asset class” with a strong long-term value proposition.
We have just completed an allocation of cryptoassets to our corporate treasury, our firm’s first of its kind investment in the asset class. This includes Bitcoin and Ethereum tokens, and carbon offsets to maintain a net-zero carbon transaction: https://t.co/32hsKbnGuC
— KPMG Canada (@KPMG_Canada) February 7, 2022
Polygon raises $450M as attention shifts to Web3
Layer-2 scaling solution Polygon made headlines this week after securing a whopping $450 million in financing from several blockchain venture funds. The raise, which was led by Sequoia Capital India, will go towards expanding Polygon’s scaling capabilities as well as supporting mainstream adoption of Web3 applications. Venture capital has made it abundantly clear in recent months that Web3 is one of its major focus areas alongside GameFi and metaverse projects.
Nasdaq lists Valkyrie’s Bitcoin Miners ETF
Crypto asset manager Valkyrie’s Bitcoin Miners exchange-traded fund (ETF) began trading on Tuesday, giving investors news ways to gain exposure to the rapidly growing blockchain economy. The fund, which trades under the ticker WGMI, invests the majority of its net assets in companies that either mine Bitcoin or provide hardware and software solutions to the mining industry. So far, the United States Securities and Exchange Commission has approved everything but a spot Bitcoin ETF. Will that change in 2022? Only time will tell.