Wall Street's Bitcoin Adoption Hindered By Regulatory Scrutiny, says one expert from Shark Tank.

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Wall Street’s Bitcoin Adoption Hindered By Regulatory Scrutiny, says one expert from Shark Tank.

Kevin O’Leary poses in front of a red and orange HBO step-and-repeat background.

In recent news, Kevin O’Leary, a prominent figure from “Shark Tank,” has voiced doubts about the likelihood of significant Wall Street institutions investing in Bitcoin. Benzinga notes that this skepticism arises despite the recent initiatives by asset managers such as BlackRock and Fidelity to establish Bitcoin spot ETFs.

During an interview with CoinBase, O’Leary expressed his concerns about the ongoing federal scrutiny of the cryptocurrency sector, led by SEC Chair Gary Gensler. He believes this scrutiny is a major deterrent for these institutions.

“They don’t own any of it, and they’re not going to own it while Gensler’s suing everybody,” O’Leary stated.

The SEC has recently launched several lawsuits against key industry players, including crypto exchanges Coinbase and Binance. The argument is that many traded tokens are unregulated securities. O’Leary suggests that this legal action limits the options for firms like BlackRock, questioning the viability of launching an ETF on an exchange under regulatory scrutiny.

O’Leary also touched on the declining stature of Binance and the intense pressure on its co-founder Changpeng Zhao. He questioned the likelihood of institutional involvement under such circumstances.

Additionally, O’Leary commented on the ongoing trial of Sam Bankman-Fried, whose mismanagement led to the collapse of the FTX exchange last year. He suggested that the era of “crypto cowboys” is ending, and without regulatory approval in the US, the industry might not expand as expected. It is understandable that he is cautious about the current state of cryptocurrency, given that he reportedly lost a little under $15 million USD personally due to that collapse.

Despite the skepticism, O’Leary did hint at the possibility of more transparent crypto exchanges emerging in other parts of the world. These could potentially attract institutional interest. However, the current regulatory environment in the US seems to be a significant barrier for major Wall Street institutions to invest in Bitcoin.