Gemini Co-Founder Sees Exciting Time Ahead As Institutional Investors Enter Bitcoin Market

Bitcoin price has been relatively stable in 2015 with its volatility against major currencies such as US Dollar has declining significantly since 2010. According to Pantera Capital, a digital currencies focused investment firm, one-year volatility hit all-time low in 2015, reaching around 52% in July and falling to below 50% in November and December. Since last January, Bitcoin has consistently maintained a low volatility rate, outperforming precious metals, assets, and currencies.

Experts have for long argued that bitcoin price would stabilize with more and more mainstream institutional investors entering the space, marking a shift in the dominant role played by intraday traders.

The trend seems to have already started with two New York-based bitcoin exchanges- itBit and Gemini– becoming regulated as financial institutions by the New York Department of Financial Services (NYDFS), which granted them trust charters. As such, they are authorized to operate in all 50 states as fully regulated financial services entities and are not required to comply with the NYDFS BitLicense regulations.

Gemini is a bitcoin exchange developed by Winklevoss brothers. According to a Money Morning article published in October last year, the Winklevoss twins pursued the banking charter path rather than applying for a BitLicense specifically because they wanted to serve institutional investors.

"I don't know if anyone has made this distinction enough. If you want to service institutional customers in New York, the BitLicense is not sufficient," Cameron Winklevoss told CoinDesk. "There's a good chance that when you get one you'll have to curtail or stop actually servicing NY institutions."

Finance Magnates explains that such establishments provide the much needed “peace of mind” to potential bitcoin investors with regard to the safety of their holdings, which in turn helps in attracting mainstream investors that had been skeptical of getting involved in the digital currency.

In conversation with Finance Magnates, Gemini Co-Founder and President Cameron Winklevoss confirmed that mainstream investors are indeed entering the bitcoin space.

“Every day we are onboarding more and more traditional financial institutions who are only willing and able to work with regulated bitcoin exchanges,” he said. “In short, the “institutionalization” of bitcoin trading is most definitely happening as we speak. It will be a very exciting next 12 months as these types of investors enter the market.”