The Bank of America (BoA), the largest commercial bank in the United States, this week launched a cryptocurrency research division as well as a new report titled “Digital Assets Primer: Only the First Inning”.
In the report, the BoA reports that there will be a huge surge in capital flowing into the crypto sector in 2021. Venture capitalists invested more than $17 billion in the crypto industry during the first half of 2021, which is more than three times the amount that went to the sector in all of 2020.
BoA also reports that no fewer than 221 million people have now bought or sold crypto, which was only 66 million in mid-2020. That is a growth of no less than 235% in one year.
BoA previously focused only on bitcoin (BTC) and bitcoin futures, but reports that it is now looking at all aspects of the crypto industry. According to BoA, bitcoin was just the beginning, but with a market cap of over $2 billion, it’s clear that crypto is bigger than just bitcoin:
“Bitcoin is important, but the digital asset ecosystem is so much more. Our research focuses on examining the implications in various sectors, including finance, technology, supply chains, social media and gaming.
It’s hard to overstate how transformative blockchain technology, digital assets, and the thousands of decentralized apps yet to be created can be. For us, digital assets are not just about payments. They are about a new computing paradigm: a programmable computer that can be accessed anywhere, by anyone and is owned by millions of people around the world.”
The BoA especially touts the emerging decentralized finance (DeFi) and non-fungible token (NFT) markets in the report. Furthermore, the BoA sees increasing regulatory pressure as the biggest short-term obstacle for crypto. In the long term, clarity from supervisors can actually attract new participants.