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Exposure to the crypto megatrend

Insights

Sygnum’s Future Finance Report uncovers a key insight: Exposure to the crypto megatrend is the principal driver for investing in crypto assets. But what does this term mean exactly?

Source: Sygnum Future Finance Report 2023

Investors are increasingly acknowledging the long-term investment case for crypto, driven by a broader acceptance of crypto assets and blockchain technology as key components of an emerging megatrend. The recent market rally this quarter, along with the anticipated approval of BlackRock’s Bitcoin spot ETF, may suggest an optimistic market outlook as we approach 2024.

But the crypto megatrend is more than just an optimistic market forecast.

The essence of the megatrend lies in crypto’s multifaceted nature. Crypto assets are appealing not only as potential investment opportunities but also for their versatility as a means of payment and Bitcoin’s growing reputation as a safe haven asset. Moreover, the underlying blockchain protocols serve as decentralised financial market infrastructures (dFMI) and are fundamental to the development of Web3.

These catalysts are driving the expansion of crypto into various sectors, spawning innovative ecosystems of their own or merging with other markets like Artificial Intelligence (AI) and traditional finance (TradFi). These infrastructures have unlocked new opportunities to engage in the crypto market, leading to the emergence of institutional DeFi, real-world asset (RWA) tokenization, crypto-based lending and staking products, to name a few. Its cross-border functionality also introduces new forms of money and addresses challenges like high exchange fees and intermediary inefficiencies, while its inflation-hedging properties may also make it suitable to combat inflation.

That being said, Bitcoin as a hedge against traditional markets is gaining prominence, supported by its declining correlation with traditional stocks, its continued outperformance versus major traditional asset classes, and its role as a maturing asset that can serve as a store of value in the current macro and geopolitical landscape.

As a unique asset class, crypto assets offer traditional investors a gateway to diversify their portfolios and access innovative on-chain asset management solutions and other crypto investment products.

It’s a long list of utilities, which is what makes the crypto megatrend narrative all the more appealing. It’s more than just Bitcoin and Ether’s upward price trajectory; it’s a rapidly evolving diverse global market full of innovative and collaborative ecosystems, drawing a spectrum of participants from crypto enthusiast to government entities and leading financial institutions to its doors.

Learn more about our Future Finance Report here:  Future Finance 2023 – Reports | Sygnum Bank

Disclaimer: The information in this publication pertaining to Sygnum Bank AG (“Sygnum”) is for general information purposes only, as per date of publication, and should not be considered exhaustive. This publication does not consider the financial situation of any natural or legal person, nor does it provide any tax, legal or investment advice. This publication does not constitute any advice or recommendation, an offer or invitation by or on behalf of Sygnum to purchase or sell any assets. No elements of precontractual or contractual relationship are intended. While the information is believed to be from accurate and reliable sources, Sygnum makes no representation or warranties, expressed or implied, as to the accuracy of the information. Sygnum expressly disclaims any and all liability that may be based on such information, omissions, or errors thereof. Any statements contained in this publication attributed to a third party represent Sygnum‘s interpretation of the data, information and/or opinions provided by that third party either publicly or through a subscription service, and such use and interpretation have not been reviewed by the third party. Sygnum reserves the right to amend or replace the information, in part or entirely, at any time, and without any obligation to notify the recipient of such amendment / replacement or to provide the recipient with access to the information. Simultaneously, there is no obligation of Sygnum to inform recipients of information, if before provided information later becomes outdated, inaccurate or obsolete, unless otherwise provided by applicable law. The information provided is not intended for use by or distributed to any individual or legal entity in any jurisdiction or country where such distribution, publication or use would be contrary to the law or regulatory provisions or in which Sygnum does not hold the necessary registration, approval authorisation or license. Except as otherwise provided by Sygnum, it is not allowed to modify, copy, distribute or reproduce, display, license, or otherwise use any content for commercial purposes.

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Disclaimer:

The information in this publication pertaining to Sygnum Bank AG (“Sygnum”) is for general information purposes only, as per date of publication, and should not be considered exhaustive. This publication does not consider the financial situation of any natural or legal person, nor does it provide any tax, legal or investment advice. This publication does not constitute any advice or recommendation, an offer or invitation by or on behalf of Sygnum to purchase or sell any assets. No elements of precontractual or contractual relationship are intended. While the information is believed to be from accurate and reliable sources, Sygnum makes no representation or warranties, expressed or implied, as to the accuracy of the information. Sygnum expressly disclaims any and all liability that may be based on such information, omissions, or errors thereof. Any statements contained in this publication attributed to a third party represent Sygnum‘s interpretation of the data, information and/or opinions provided by that third party either publicly or through a subscription service, and such use and interpretation have not been reviewed by the third party. Sygnum reserves the right to amend or replace the information, in part or entirely, at any time, and without any obligation to notify the recipient of such amendment / replacement or to provide the recipient with access to the information. Simultaneously, there is no obligation of Sygnum to inform recipients of information, if before provided information later becomes outdated, inaccurate or obsolete, unless otherwise provided by applicable law. The information provided is not intended for use by or distributed to any individual or legal entity in any jurisdiction or country where such distribution, publication or use would be contrary to the law or regulatory provisions or in which Sygnum does not hold the necessary registration, approval authorization or license. Except as otherwise provided by Sygnum, it is not allowed to modify, copy, distribute or reproduce, display, license, or otherwise use any content for commercial purposes.

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