Caitlin Long warns Bitcoin investors about TradFi institutions’ unpreparedness for future bear markets.
- Caitlin Long warns crypto investors at Wyoming Blockchain Symposium.
- Traditional finance faces risks from upcoming crypto bear markets.
- Lack of adequate risk models in institutional finance.
Caitlin Long, CEO of Custodia Bank, issued a warning on August 24, 2025, at the Wyoming Blockchain Symposium to Bitcoin investors about potential risks in the next crypto bear market.
This warning spotlights risks facing traditional finance firms in a volatile crypto market, highlighting potential liquidity challenges for BTC and ETH from institutional sell-offs.
Custodia Bank CEO Caitlin Long has warned Bitcoin investors about risks posed by the next crypto bear market, addressing concerns at the Wyoming Blockchain Symposium.
Long highlights potential issues with traditional financial institutions’ preparedness for the volatile nature of crypto market settlements.
Caitlin Long Highlights Institutional Risks Ahead
Custodia Bank CEO Caitlin Long issued a stark warning to Bitcoin investors, emphasizing that traditional financial institutions may lack necessary risk models to weather an upcoming bear market, potentially leading to market instability. “Those kinds of fault tolerances are built into the system because of legacy reasons, where systems were not updating in-real time. In crypto, everything has to be real-time, and it’s just a different animal. I do worry how those titans of finance will react when the bear market inevitably comes again. I know some who are optimistic and think it won’t come again. I’ve been around since 2012, so I know it’s coming again,” said Caitlin Long, CEO of Custodia Bank.
Caitlin Long spoke at the Wyoming Blockchain Symposium, raising concerns about the inadequacies in real-time risk management practices within traditional finance that could exacerbate issues during future downturns.
Implications for Institutional Newcomers Revealed
The warning specifically impacts institutional newcomers to the crypto sector, who may lack the tools needed for addressing potential liquidity crunches stemming from rapid market declines. Market analysts and industry leaders have highlighted the risk of cascading sell-offs and how liquidity issues could trigger systemic problems in traditional finance due to their slower settlement systems.
Lack of Central Bank Support in Crypto Examined
Past crypto downturns have seen overleveraged institutions forced into liquidation, leading to severe market declines, similar to events during the 2022 collapse of major lenders. Experts point to the lack of central bank support in crypto markets as a key difference, suggesting further market innovations and risk management adaptations will be needed to prevent further contagion.
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