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74% of institutional investors intend to purchase digital assets, details inside

29 Oct, 20223 min readOther
74% of institutional investors intend to purchase digital assets, details inside

Even though Bitcoin is currently trading at a little over $20,000, 70% less than its all-time high of $69,044, institutions continue to remain bullish. 58% of institutional investors were invested in cryptocurrency and other digital assets in the first half of 2022, 6% more than the last year.

The above finding is a part of the latest Institutional Investor Digital Assets Study published by the Boston-based investment firm Fidelity Digital Assets.

74% of institutional investors intend to purchase digital assets in the future. 51% of them have a positive outlook toward the crypto market, in comparison to 45% in 2021.

Investors in Asia own more digital assets (69%) than those in Europe (67%) or the United States (42%). Europe has witnessed an 11-point increase in ownership, while the U.S. has witnessed a nine-point increase in ownership since 2021. This upward trend was primarily driven by high-net-worth investors in both of these regions, in addition to financial advisors in Europe.

“While the markets have faced headwinds in recent months, we believe that digital assets fundamentals remain strong and that the institutionalization of the market over the past several years has positioned it to weather recent events… Institutional investors are experienced in managing through cycles, and the largely inherent factors that they cited as appealing in this study will likely remain as the market emerges from this period,” said Tom Jessop, president of Fidelity Digital Assets.

Technological innovation and decentralization are the two most promising features that draw the attention of investors, the respondents said.

35% of them believe that digital assets should be considered as an independent investment class, up from 23% in 2021.

Consistent crypto holdings during the crash

We mustn’t forget that the crypto industry witnessed a market crash in the second quarter of this year, following the collapse of the Terra stablecoin system.

It is amidst such circumstances that these institutions kept putting in their money. The fact that these investors have very large pockets helps.

One such example is that of the American software firm, MicroStrategy. It currently holds 130,000 BTC, worth $3 billion.

It was during the same period that traditional investors pulled hundreds of millions of dollars out of Bitcoin funds.

The above survey included 1,052 institutional investors from the United States, Europe, and Asia. Institutional investors here mean hedge funds, financial advisors, and high-net-worth individuals.

It should be noted that the survey period of the report ends in June. We also need to observe the behavior of these investors during the remaining part of the year and then, possibly, arrive at a conclusion.

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