In a video x.com/howardlutnick/status/1831080474124681316″ target=”_blank” rel=”noopener nofollow”>release On Wednesday, Howard Lutnick, CEO of Wall Street firm Cantor Fitzgerald, offers some surprising predictions about the future relationship between traditional financial institutions and bitcoin. The video, titled “Howard Lutnick on bitcoin and Traditional Finance,” is causing a stir in the community as Lutnick describes a bold future where big banks will become deeply involved with btc.
Big banks will adopt bitcoin
Lutnick highlights the past five years as a period of increasing proximity between bitcoin and the mainstream financial sector, albeit with significant barriers remaining. He notes: “Over the past five (years) bitcoin has been an outsider in the financial business, but now it’s getting closer and closer. There’s an ETF that’s starting to get a little bit popular, maybe a little bit in the mainstream water, but banks can’t license it yet. Banks can’t transact with it yet. Banks can’t custody it yet. Banks don’t transact with it yet and they don’t fund it yet.”
Cantor Fitzgerald’s CEO argues that the slow adoption is not due to a lack of interest from traditional financial sectors, but rather to regulatory hurdles that have not yet been addressed. “I think people don’t understand traditional financial services companies. They want to transact in bitcoin, they want new asset classes to transact in. That’s a good thing, but they need the regulator to say it’s okay,” he explains.
The biggest barrier for “traditional financial services firms, big banks, big brokerage firms” is current regulations that require banks to hold capital equal to the total amount of btc they handle, a restriction that significantly disincentivizes them from engaging in such operations. “Right now, if a bank had your bitcoin, they would have to set aside their own money equal to that amount in a kind of jail. I would say that’s crazy. The answer is that’s why they don’t have it,” Lutnick says.
He envisions a future where regulatory changes will unlock these barriers, leading to enthusiastic adoption of btc by major financial institutions. “If the regulatory environment was good, we would see all the traditional financial services companies, the big banks, the big brokerage companies, everyone would dive headfirst into the bitcoin pond,” he states.
The expected shift hinges on a potential regulatory change that would recognize bitcoin as a genuine financial asset, a shift that Lutnick believes is inevitable. “Eventually, there will be a CFTC chairman who says, you know what? bitcoin is a financial asset and we’re going to treat it as such and when that happens, we’ll see bitcoin move in a very, very positive direction,” he predicts.
Lutnick concludes: “bitcoin is a financial asset and we are going to treat it as such and when that happens, we will see bitcoin move in a very, very positive direction. That’s why I’m a fan of bitcoin. It’s going to go much higher. It always bounces around like any other financial asset. But ultimately, over the next 5 years, when you get invited to this party, we will go up.”
btc Community Reactions
The community's reactions were swift and forceful. Arthur Hayes, co-founder and former CEO of cryptocurrency exchange BitMEX, x.com/MacroScope17/status/1831093714644881669″ target=”_blank” rel=”noopener nofollow”>noted Via x: “See what happens when industry puppets have to make money? They become motivated acolytes of our Lord Satoshi.”
Cryptocurrency analyst MacroScope, known on x as @MacroScope17, x.com/CryptoHayes/status/1831099953818857653″ target=”_blank” rel=”noopener nofollow”>pointed out The significant potential behind Cantor Fitzgerald’s involvement. “Cantor’s involvement in btc hasn’t received the attention it should have. This is probably because the firm is not well known in the retail world. But it has always been a smart, tough, aggressive company with top-notch desks in multiple areas. They are always worth following.”
Hunter Horsley, CEO of Bitwise, x.com/HHorsley/status/1831091506519937148″ target=”_blank” rel=”noopener nofollow”>agreed On Lutnick’s prediction, he commented: “Oddly enough, banks will be one of the biggest catalysts for this sector. Not yet, but soon.”
At the time of writing, btc was trading at $56,406.
Featured image from YouTube, chart from TradingView.com
