As the crypto market surges to a whopping $2.49 trillion valuation, up 45% since the start of 2024, we asked CLS Global to share their insights on the major factors driving this growth. According to the leading cryptocurrency market maker, regulatory changes and the approval of crypto ETFs are two of the biggest catalysts.
2024 Has Some Interesting Regulatory Changes
“2024 is shaping up to be a pivotal year for cryptocurrencies worldwide as regulations evolve and politicians take different stances on digital assets,” said Filipp Veselov, CEO of CLS Global. “At the same time, the introduction of crypto ETFs is opening the doors for increased institutional adoption.”
In the United States, a major crypto market, the SEC has been actively sending notices, lawsuits, and cease and desist orders to crypto exchanges and protocols. The US presidential race is also another crucial factor. Donald Trump has already shown his positive stance. If he wins and fulfills his promises, it can drastically change the crypto environment in the continental United States – hopefully for the better.
The UK and EU have extremely complex regulations, including proper licenses for crypto businesses to operate. This includes consumer protection through KYC and AML laws, especially the EU’s Markets in Crypto Assets Regulation (MiCA). MiCA’s latest implementation has sent EU-based crypto exchanges running back and reviewing their policies. The result is some EU exchanges decided to delist USDT and other stablecoins. This major move will definitely change the trading dynamics and dependency on assets that traders can use to hedge in a bearish market.
“While this move may seem detrimental in the short term, better controls that protect user rights and ensure operational safety can ultimately boost confidence and institutional adoption in the long run,” Veselov noted.
How ETFs Can Drive Institutional Adoption
CLS Global believes that crypto ETFs are one of the biggest drivers of institutional adoption in 2024. “The current Bitcoin ETF market cap stands at almost $80 billion, led by the Grayscale Bitcoin Trust and BlackRock. These numbers show the immense potential for crypto adoption when major players enter the fray,” said Veselov.
Crypto ETFs have become an entry point for traditional investors, serving as a dual-edged sword. They allow investors who are uncomfortable directly handling cryptocurrencies or prefer traditional investment vehicles to gain exposure to the crypto world while staying within clear-cut regulations.
With institutions now applying for Ethereum ETFs, the industry is eagerly anticipating further market solidification. As Veselov pointed out, “Any Ethereum ETF approval will bolster the crypto market as institutional investors gain exposure to the second-largest cryptocurrency alongside Bitcoin. This could pave the way for additional ETFs tracking other major crypto assets like Solana, Polygon, and even Dogecoin.”
CLS Global’s Presence in A Regulated Market
With 2024 being an important year for new regulations and institutional adoption, the crypto market’s explosion is imminent. Regulatory aspects aside, it is essential for any crypto project to have sufficient market and liquidity to attract traders, including institutional ones.
“At CLS Global, we have established a significant presence in the crypto sphere, collaborating with over 500 firms, including major CEXs like Binance, Gate.io, and MEXC; DEXs such as Uniswap, Suchi, and PancakeSwap; VCs CRT Labs, Spartan, Shima Capital, and others.”
The Future of Regulations and Institutional Adoption
As governments and regulators start stirring up, the next months and years are critical. While more and more jurisdictions are opening up towards crypto, especially paving the way for institutional adoption through ETFs, it is critical to keep an eye out, allowing traders, both small and large, to predict what they should include in their portfolios.
Between all this, CLS Global can help crypto firms in all stages of development and existence, to navigate the complex regulatory landscape of the crypto world.
