Ivy League Universities Set to Boost the Crypto Industry With an Injection of Institutional Investment

Despite the crypto volatility, the widely publicized regulatory concerns and a lack of liquidity in the cryptocurrency market, reports show that university endowments worldwide are dipping their toes into cryptocurrencies.

A brief background of endowment fundsEven though most universities are financed by the government, educational institutions also get much of their income from the courses they teach.

Endowment funds come from donations that are given to colleges and universities for the purpose of investment.

Despite crypto winter, endowments are not walking awayAlthough respondents form the survey conducted by Golden Custodian acknowledge the risks that the cryptocurrency market is currently facing, only 7% of the respondents anticipate an annual decrease in the funds they have invested.

Although details about the amount were not revealed, UoM's endowment confirmed its dedication to inject additional investment into the Andreessen Horowitz's fund dedicated to crypto.

What are the skeptics saying?Following the move by UoM's endowment fund, most onlookers like David Nage believe that the rationale that drives the University of Michigan's interest in crypto is too bullish for the ecosystem.

"University of Michigan's Endowment invested in a16z crypto back last year but has approved follow on investment recently. The rationale listed below I find interesting and bullish for the ecosystem."

"The smart money is not distracted by price [volatility] but looks at the long-term trends, and believes they're betting on innovation as a great way to deliver risk-mitigated returns.''.Institutional investing meets cryptoThe reality of investing in crypto is that it forces endowment investment officers to adapt to a whole new set of issues. After all, crypto bets are very different from taking equity stakes in regular startups.While speaking to CNBC last year, Bill Barhydt, the CEO of cryptocurrency exchange Abra, said:."People are excited about it but afraid of being the first, or having to explain themselves.

That is why most onlookers believe that the confidence in crypto as shown by the world's leading endowments might lead to increased high-profile institutional investment in the cryptocurrencies world by other institutional investors, as was the case in 2017.

Granted, the investment arm of any university is typically independent of the academics, the move by endowment investors like Swensen is a strong signal that blockchain and cryptocurrencies are here to stay.