The head of the country’s only licensed and publicly traded cryptocurrency broker says tighter regulation and exponentially higher yields are causing corporate treasury and cash management accounts to seriously consider this alternative asset class. This in the wake of the OCC’s Sept. 21 landmark announcement that allowed national banks and federal savings associations to hold certain crypto assets for the first time.
Ehrlich said stablecoins, including the U.S. dollar-backed USDC, currently offer APR rates as high as 8.5 percent. With the treasury market for S&P 500 companies valued at $2.3 trillion, he said if only 1 percent of those proceeds migrated to crypto in search of yield enhancement and asset diversification, it would still be a $23 billion shift. “Treasury desks will diversify money market and CD portfolios into these assets as digital assets are better understood and regulated, thereby improving risk/reward profiles,” Ehrlich said.