S&P Global Ratings Study predicts that crypto and decentralized finance will continue to grow in 2022. – – Crypto News
S&P Global, an intelligence and data company, predicts that crypto and decentralized financial trends will continue to gain momentum in 2022, hindering adoption if the sector continues to grow in the coming year by complementing traditional finance.
S&P Global believes that crypto will continue to grow in 2022
A new report from S&P Global, an information and data company, predicts that cryptocurrency and the decentralized financial sector will continue to grow in 2022 report, titled Global Credit Outlook 2022, explains that while institutional crypto investments are still focused on a few companies, this could lead other institutions to follow suit. The report says:
Three companies – Block.one, MicroStrategy, and Tesla – hold nearly 84% of corporate investments in Bitcoin. However, the growing interest of institutional investors heralds an accelerated expansion of cryptocurrencies as an investment vehicle.
According to the report, tokenization could also be a powerful force to help people invest in assets that they couldn’t have created without these tools. In other words, tokenization could provide an opportunity to democratize opportunities. Regulation will continue to be an important part of the next year as the industry still “needs a regulatory framework that recognizes the rights of token holders and smart contract protocols”.
Defi won’t put traditional finances at risk
Regarding decentralized finance, the report says that while the sector will continue to grow, it will not jeopardize the traditional structures that manage banking and finance. However, these institutes have to adapt to today’s user expectations of financial platforms. The report explains:
Defi will continue to complement, not replace, traditional finance in 2022. We anticipate that in 2022 it will continue to evolve towards complementing the current financial system rather than replacing financial services companies. In order to remain relevant, we believe that incumbents must continue to invest in new technologies.
According to the report, regulation will be a key factor in the growth (or stagnation) of decentralized finance over the next year. S&P Global believes the volume growth and surge in stablecoins in this space will put pressure on the regulatory debate, but regulators are unlikely to do so leap Addressing these issues quickly as they often lack the framework to fully monitor crypto assets, and this in itself becomes a challenge.
What do you think of the predictions in the S&P Global Report? Let us know in the comments section below.
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Source: Crypto News Austria