Hassan Maishera
Despite the major strides made by crypto/blockchain technology, especially in terms of the increasing prevalence of digital currencies within the mainstream, the anticipated global mass adoption of cryptocurrencies has not materialized as expected. As of 2023, the global crypto ownership rate stands at around 4.2%, a number that does not align with the more optimistic predictions made earlier by the proponents of the technology.
One of the critical factors hindering wider adoption has been the uncertain regulations permeating this space, with possession and trading laws differing substantially from region to region. To add to this, the past year alone has been marred by the dissolution of several high-profile crypto companies as well as several prominent hacks.
For instance, earlier in March 2023, Euler Finance suffered a hack resulting in the theft of almost $200 million. Similarly, over Q1 2023, over $320 million was stolen from different crypto entities such as Deus Finance, highlighting the severity of security concerns in the ecosystem.
A Closer Look at the Problem at Hand
In contrast to the many complexities put forth by the crypto sector — i.e. in terms of its policies, terms of operation, payment methods, etc. — the traditional finance (TradFi) arena offers a relatively straightforward technological proposition.
Moreover, even with the various advancements made by the digital asset industry, the prevalence of third-party attacks and security breaches has led to significant financial losses for many investors, thereby highlighting the need for better security (for TradFi users) who may not be familiar with the nuances of digital asset protection.
Lastly, the intricate layers of technical knowledge required for successful crypto trading can be overwhelming for the average customer. This tech gap, coupled with the pervading security and regulatory uncertainties, makes the crypto market less accessible and appealing to traditional finance users.
In response to these challenges, entities like the MultiBank Group, a well-established player in the financial derivatives arena, have sought to make strategic moves so as to bridge this divide. Established in 2005 with a vision of bringing regulation and safety to the financial industry, MultiBank Group has significantly grown to become a major financial derivatives institution.
The firm holds over 14 licenses globally, operates from 25 international offices, and serves a large customer base of over 1,000,000 active clients. With an impressive average daily trading volume of $12.1 billion, MultiBank Group has earned recognition as the world's most regulated derivatives broker.
Leveraging this strong foundation, MultiBank Group has ventured into the crypto space with MultiBank.io. Their entry into this new sector is marked by a personalized approach, with the firm assigning an individual relationship manager to each client. It is a strategic move aimed at making the intricate world of cryptocurrency more accessible and navigable, especially for clients transitioning from the more traditional aspects of finance.
Looking Ahead
Despite the challenges facing the cryptocurrency market, there has been an increasing integration of traditional financial institutions (TradFi) into the crypto space. To this point, major entities in the TradFi sector are making significant inroads into cryptocurrency, indicating a trend toward a more integrated and robust financial ecosystem.
For example, the Bank of New York (BNY) Mellon, the oldest bank in America, alongside several other financial institutions such as U.S. Bancorp, BlackRock, Fidelity Investments, State Street, and JPMorgan Chase, have all launched their digital-asset custody platforms. Similarly, entities like JPMorgan Chase, Goldman Sachs, and Bank of America have their very own crypto trading desks, while wealth management firms, such as Morgan Stanley and Wells Fargo, provide their clients access to crypto through their various products and funds.
Therefore, as more and more mainstream institutions — like the MultiBank Group — continue to integrate their TradFi offerings with crypto, they stand to bring greater regulatory oversight and a more user-friendly experience to the industry. Not only that, this progression also stands to enable more people to recognize the potential of cryptocurrencies, potentially spurring a new wave of user adoption and ultimately fostering wider acceptance of digital assets on a global level.
