Anthony Scaramucci says people claiming big institutions are keen on crypto aren't being totally honest

September 27, 2021

Anthony Scaramucci says people claiming big institutions are keen on crypto aren't being totally honest

Anthony Scaramucci sees little sign of institutional interest in crypto, despite the retail boom.
The Skybridge Capital boss said anyone who says there is institutional adoption "is not being totally honest."
Some big banks are getting involved, but plenty of others are put off by wild volatility.
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Crypto investor Anthony Scaramucci has said there is little interest from big financial institutions in digital assets, despite what some bitcoin bulls say.

"The institutions are not there," Scaramucci told Bloomberg in an interview published at the weekend. "Anybody who's telling you there's institutional adoption into this space is not being totally honest - or they're seeing something that I'm not seeing."

Scaramucci, the SkyBridge Capital boss and former White House communications chief, said he thinks only about 10% of financial institutions are getting involved, but are having an outsized impact. Among them, he said, it's like a "feeding frenzy."

Bitcoin has risen about 300% in price over the past year, alongside a surge in other major cryptocurrencies. Analysts see two key factors driving up prices: Governments have pumped huge amounts of stimulus into economies during the coronavirus crisis, and there has been a boom in retail investing.

Some big-name institutions have been drawn to the crypto world, boosting bitcoin fans' hopes of legitimacy for the world's largest cryptocurrency. Insider revealed in July that JPMorgan will allow its wealth management clients to access cryptocurrency funds. Goldman Sachs has restarted its crypto trading desk, and Vanguard and Fidelity are keen to launch bitcoin exchange-traded funds.

Yet much of Wall Street is steering clear of digital assets. One concern is their wild volatility, with prices regularly swinging by 10% in a day. Another is that regulators are wary of crypto, as shown by China's outright ban of digital asset transactions.

The cryptocurrency market surged in value on Monday, recovering from a slump Friday triggered by China's ban. Tokens linked to decentralized exchanges, such as sushi and uniswap, led the recovery with gains of around 30% at one point.

Scaramucci, whose SkyBridge firm is a major crypto investor, said he thinks that decentralized finance or DeFi will trigger more interest in the space from institutions. DeFi is the use of crypto technology to create smart contracts that automatically execute when parameters are met. That means they do not need to be supervised by middlemen such as clearing houses or banks.

Scaramucci said he thinks one of the big banks will "end up buying a Coinbase or something crypto-related" as a way to gain a big presence in the crypto world.

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