Morgan Stanley’s report states institutional investors are increasingly getting involved in a variety of cryptocurrencies including Bitcoin, while the number of retail investors in the space seems to be at a standstill. The global banking giant’s research division studied the last six months of bitcoin and began highlighting particular trends it noticed. It released these trends in an update to “Bitcoin Decrypted: A Brief Teach-In and Implications,” dated October 31.

One piece of the report may be more noticeable than others as it emphasized its writers’ view of the market’s “rapidly morphing thesis,” which began by defining bitcoin as “digital cash” and adding that investors have full confidence in it from a solution for issues in the financial system, to ultimately a new institutional investment class.

A variety of issues and discoveries around bitcoin led the thesis to evolve, which includes the permanent ledger recording all transactions, a number of hacks, hard forks, new technologies which are cheaper than bitcoin, market volatility and other concerns, the report explains. The author wrote that the market’s current thesis seems to be that Bitcoin is a “new institutional investment class,” and has been for almost a year. Crypto assets under management continued to increase since January 2016, with $7.11 billion currently being stored by hedge funds, venture capital firms and private equity firms.

The report continued stating that with major financial institutions increasingly getting involved, it further supports this thesis, in which it cited Fidelity’s new crypto services division, investments in Seed CX, BitGo and Binance, regulatory approvals and Coinbase’s recent fundraising round. Although the thesis is gaining support, the report also noted three issues clients encountered with investing in the crypto space, including regulatory uncertainty, a lack of regulated custodian solutions and a current lack of large financial institutions in the space.

The report also delved into a recently popular topic: stablecoins, or types of cryptocurrencies that seek to enable some form of price stability. Bitcoin is “moving increasingly towards trading vs the stable coin USD-Tether (USDT) [sic],” the report states. The report’s author said due to many cryptocurrency exchanges not accepting flat currencies, it is contributing to this state of affairs.

“USDT took an increasing share of BTC trading volumes as cryptocurrency prices started falling. This occurred because many exchanges only trade crypto->crypto and not crypto->fiat. Trading crypto->fiat requires going through the banking sector which charges a higher fee. Also as bitcoin prices fell, so did most all other coins so if owners wanted to come out of bitcoin holdings, they needed to go to another asset which was closer to the valuation of the U.S. dollar.”

As “part of the next wave of development,” exchanges and other companies are beginning to develop their own stablecoins. With that being said, researches add they do not foresee all stablecoins surviving: only those “with the lowest transaction costs, highest liquidity and defined regulatory structure” are likely to see increased adoption.

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