The coronavirus pandemic-induced cryptocurrency market crash in March this year did not deter investors from taking positions in cryptos. On the contrary, a survey by Fidelity Digital Assets revealed that the number of institutional investors with exposure in cryptocurrency has more than doubled this year compared to 2019.
But things are about to get even better. A recent survey made by a digital currency firm revealed that institutional investors are set to “dramatically” increase their crypto asset holdings in the next five years, according to Bitcoin.com.
Cryptocurrency insurance firm Evertas surveyed a group of institutional investors that collectively manage $78 billion in assets. The group included traditional financial institutions, funds, exchanges, family offices, custodians, and ultra-high net worth individuals.
Ninety percent of those who participated in the survey believe that institutional investors will likely increase their holdings of cryptocurrencies in the next five years. This result of the recent survey corroborated the findings of previous studies that showed increasing interest in digital assets among institutions.
While interest for crypto assets is on the rise, investors likewise revealed that they have a number of concerns when it comes to placing their money in crypto assets. For instance, 56 percent of the participants are “very concerned” about the lack of insurance in the cryptocurrency economy. Another 54 percent is also “very concerned” on the compliance procedures required by crypto services.
The respondents also identified some of the factors that would push institutional investors to increase their crypto holdings. Eighty-four percent say that improvement of the regulatory infrastructure governing the niche will likely improve making the digital assets more attractive as investment alternatives.
Meanwhile, eighty percent of the respondents believe that the crypto market will grow in the coming years. This makes it more attractive to institutions as a bigger market would mean greater liquidity.
Another future development that could positively affect investor sentiments includes the entry of more mainstream fund managers and financial services companies, which is mentioned by 76 percent of the participants. Meanwhile, 76 percent of the respondents also believe that the creation of more crypto asset-focused investment vehicles.
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