Institutional investors seem to have lost interest in cryptocurrencies, even though Bitcoin BTC/USD gained almost 75% of its value this year, according to Northern Trust Corp's NTRS head of digital assets and financial markets.
What Happened: Justin Chapman, the head of digital assets and financial markets at Northern Trust, told CNBC that the appetite for crypto assets hasn't come back yet.
See More: Is Bitcoin a Good Investment?
Chapman said that institutions have shifted their focus to cryptocurrency's underlying blockchain technology, but his firm has capabilities in place if client interest in digital assets rebounds.
"Just after March the crypto market went off a cliff…the client interest has definitely gone off the same cliff in terms of institutional interest in cryptocurrencies," Chapman said. "It's definitely quiet now, since 2022, from the institutional side…even the hedge funds, who are pretty active in the markets, have certainly reduced their exposure within that particular space."
Why It Matters: Bitcoin's regulatory crackdown in the U.S., as well as the banking crisis, has brought back volatility to the market, though it still struggles to break above the $30,000 level.
Chapman said, "We're not focused that much on the asset class because the client isn't at the moment…It certainly lost its shine from the institutional perspective."
Price Action: At the time of writing, BTC was trading at $29,226, up 0.59% in the last 24 hours, according to Benzinga Pro.
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