Firms on Wall Street are planning to compete with crypto exchanges like Binance and Coinbase

Traditional businesses want to win over crypto clients by promoting their impeccable reputations, extensive knowledge of the financial sector, and regulatory permission.

Standard Chartered, Nomura, and Charles Schwab, among other well-known names in the finance industry, are reportedly among those hard at work developing and supporting cryptocurrency exchange and custody systems, as reported by FT on May 31.

Famous Wall Street corporations are wagering that hedge fund managers will continue to trade cryptocurrencies despite the bear market and recent controversies involving the industry.

The collapse of the Terra ecosystem and the FTX bankruptcy are only two examples of the dangers of investing via uncontrolled exchanges. However, traditional companies think that asset managers would rather work with well-known entities than with crypto-native exchanges like Binance.

Bernstein’s Senior Global Digital Assets Analyst Gautam Chhugani told FT: “The big, old-school, institutional investors almost universally favour dealing with counterparties they know have been around for a while and have been traditionally regulated.”

EY-Parthenon revealed the results of a poll they conducted with 250 asset managers earlier this month, and they found that half of them would contemplate transferring from a crypto-native firm to a traditional-backed business if both provided the same services. Ninety percent of those polled also said they felt comfortable with conventional financial institutions serving as custodians for their cryptocurrency.

Crypto investors’ faith has been shaken by the recent failure of many major cryptocurrency businesses and the revelation of their alleged malpractices.

Traditional financial institutions are hoping to attract customers by promoting their extensive knowledge of the finance business, stellar track records, and relative lack of regulatory oversight. In response to the success of Coinbase and Binance, a new wave of legacy-backed crypto platforms will enter the market.

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