A new study by Ripple says over 75% of financial institutions intend to use crypto in the next three years and cited a lack of proper regulatory framework as the reason why they hadn’t done it previously.
According to Ripple’s most recent Value Report, 76 percent of financial institutions intend to incorporate cryptocurrencies into their business practices within the next 36 months. However, the majority of those organizations stated that they would enter the sector if the right regulatory framework was in place.
Twenty percent of consumers worldwide said they would only purchase sustainable cryptocurrencies, according to the report. But the company emphasized that many customers are unaware of which digital assets use the Proof-of-Work (POW) consensus method and which are less power-hungry.
Ripple’s View on Recent Crypto Trends
According to the study (pdf below), over 75 percent of international financial institutions plan to join the cryptocurrency bandwagon within the next three years. When asked why they hadn’t done it previously, the majority of participants cited a lack of proper rules as well as the numerous scams that have recently taken place in the industry.
The adoption of cryptocurrencies should also be encouraged by banks’ attitude toward the market. Only 17 percent of respondents stated it wouldn’t matter, but 65% admitted they would be far more likely to invest in bitcoin or other cryptocurrencies if their local financial institution offered such services.
However, it is important to keep in mind that over time, a significant portion of the financial entities have transformed into HODLers. According to 50% of respondents, their top three reasons for doing so are that they view digital assets as excellent inflation hedges, “a currency for making payments, or as an asset to lend or collateral for borrowing in their top three reasons.”
Companies and individuals based in Latin America appear to be the most interested in the sector globally. According to 50% of them and 35% of the respondents from Europe, cryptocurrencies will have a significant impact on the economy in the future.
NFTs and CBDCs
The study also discussed central bank digital currencies (CBDCs) and non-fungible tokens (NFTs). Ripple remarked that in recent months, interest in digital collectibles had “skyrocketed.” However, the market is still in its “very early days,” and the majority of customers are either confused about it or have doubts about it.
Seventy-nine percent of respondents who are aware of the advantages of NFTs said they would buy such products for functional advantages rather than emotional ones (45 percent).
People appear to find non-fungible tokens associated with the music, gaming, and sports industries to be the most intriguing, but collectibles associated with pop culture and movies trail behind.
The advantages and disadvantages of CBDCs were then discussed, along with the opinions of customers and financial institutions. The company says that the product will considerably boost monetary inclusion, for instance, by increasing the speed and distribution of stimulus payments.
“They leverage the same underlying technology that drives efficient, new digital assets like crypto, they can be used for cross-border payments with less friction and cost compared to traditional solutions. And finally, because they can be easily managed, they can support strong and swift implementations of various monetary policies,” the firm added.
However, they won’t give the same freedom as bitcoin and other altcoins because they will be totally centralized and under governmental control.
36% of the financial institutions polled believe CBDCs will have a substantial impact on society, while 34% feel they will strengthen the economy network. Only 28% believe that the products will help the business sector prosper.
Read the study given below: