As interest from institutions in cryptocurrencies continues to rise, the industry appears to be entering a more developed stage characterized less by speculation and more by strategic integration.

In light of earlier anxieties following major market collapses such as FTX and Celsius, traditional financial entities like hedge funds, banks, and asset managers have reassessed their strategies toward cryptocurrency involvement.

In this discussion, Yoyee Wang, head of Bybit’s Business-to-Business Unit, shares insights on the evolving nature of institutional participation, the renewed focus on trust and transparency, and the burgeoning partnerships between traditional financial systems and the cryptocurrency realm. Dive in to explore what factors will shape greater institutional engagement as we approach the end of 2025.

Image

Q1: Institutional appetite and strategies have changed significantly in light of recent market shifts. Can you elaborate on this?
Yes, there is a noticeable increase in institutional interest from two major groups. First, new players like trading firms, hedge funds, and wealth managers are eager to expand offerings due to rising client interest in cryptocurrency investments. Interestingly, the second group consists of those who originally entered the crypto space but withdrew during the FTX collapse. Many of these institutions are now either returning to the market or increasing their exposure significantly.

Q2: What steps is Bybit’s B2B unit taking to enhance trust and transparency? Indeed, custody plays a pivotal role in our services. Bybit has integrated with a range of custodial partners—ranging from crypto-specific firms like Copper and Fireblocks to bank-backed institutions such as UBS and Qatar National Bank. Additionally, we are incorporating best practices from traditional finance to ensure our clients benefit from robust liquidity management, encompassing cross-margining and real-time settlement.

Q3: Given your extensive background in traditional finance, what potential collaborations do you foresee between traditional and digital asset markets? Collaboration must provide value to all parties. By questioning what traditional finance can offer to the digital asset space—and vice versa—we can identify promising opportunities for synergy.

Q4: Tokenization is anticipated to be a crucial development for blockchain usage. How is Bybit facilitating this? We are actively providing solutions to launch and grow real-world asset (RWA) projects. However, regulatory ambiguity and liquidity issues still pose considerable challenges for institutional-scale engagement with RWAs.

Q5: As we look ahead to 2025, what signs will suggest that institutional adoption has matured? The future lies in the integration of cryptocurrencies as fundamental components of business models and operations, rather than merely as alternative investments. It will signify a mature stage where crypto ceases to be viewed as an outlier in finance.

Disclaimer: This conversation is for informational purposes and should not be taken as financial advice or endorsements. The intricate nature of cryptocurrency entails inherent risks. Readers are recommended to perform their own due diligence and consult with financial advisors before engaging in investment activities.