Blockchain Technology and Financial Services Transformation: Evidence from Institutional Cryptocurrency Adoption

Introduction/Main Objectives: The advent of blockchain technology has introduced a new paradigm in the financial landscape through decentralization, immutability, transparency and enhanced efficiency in financial services. This study focuses on institutional cryptocurrency adoption and its implications for financial services transformation in the blockchain era. Background Problems: Most studies have focused on the institutional adoption of one cryptocurrency or one institutional investment channel. This study focuses on institutional cryptocurrency adoption via three distinct institutional investment channels for Bitcoin and four other key cryptocurrencies. Novelty: There have been some limited studies that have attempted to quantify the various institutional channels for investing alongside the key cryptocurrencies. This study set out to fill this gap through a thorough empirical assessment of institutional cryptocurrency adoption. Research Methods: The study adopted a quantitative method and secondary data was obtained from credible databases and market reports on cryptocurrencies. Descriptive analysis and comparative concentration of ownership analyses were used on the basis of participation of institutions, geographical coverage, institutional holdings, CR5, CR10, Herfindahl Hirschman Index (HHI) and Gini coefficient. Finding/Results: These results highlight the patterns of institutions in adopting digital assets, specifically Bitcoin, as part of the broader digital currency adoption in today's financial environment. Blockchain technology is helping in the modernization of financial services. Conclusion: The paper empirically quantifies institutional cryptocurrency adoption through different investment channels and digital assets on the market, which contributes to the literature. The findings are provided attention to the financial service industry, institutional investors, policymakers and market regulators.