Institutionalization of cryptoassets

Cryptoassets have arrived. Are you ready for institutionalization?

Arun Ghosh

Arun Ghosh

U.S. Leader – Climate Data and Technology, KPMG US

Judd Caplain

Judd Caplain

Principal, Advisory, FS - Advisory, KPMG US

+1 212-872-6802

Cryptoassets (or crypto) have garnered significant attention from the media, financial analysts, governments, regulatory institutions, and investors over the last year and a half.

Crypto is defined broadly as digital units of account in which cryptographic techniques are used to regulate the generation and distribution of units on a blockchain. In practice, crypto means multiple things to different people: an investment asset class like commodities, a store of value like gold, a legitimate medium of exchange, a covert method of exchange, an immutable record of rights and ownership, or even an incentive mechanism like rewards points.

In this paper, we use "crypto" to refer to all cryptoassets. Cryptocurrencies, security tokens, and utility coins are different types of cryptoassets. Some of these terms may be used interchaneably, particularly where concepts are applicable broadly to all types of assets, tokens, and coins.

This paper provides an overview of the crypto market, introduces the emerging tokenized economy, and identifies the key challenges to the adoption of crypto in the global financial services ecosystem. We also introduce KPMG’s Cryptoasset Frameworkto help address these challenges. The framework underpins KPMG’s crypto capabilities that have been developed through our work with crypto exchanges, start-ups, and large financial services organizations.