Recent Research Notes Institutions Preferring Crypto Investments
Amid trading volumes for institutional investment products falling to two-year lows, nearly 60% of investment firms said they were engaged in digital assets in the first half of the year, according to a survey by Fidelity Investments.
So according to Bloomberg, a Fidelity Investments survey showed that four out of five investors expect their investment portfolios to also include cryptocurrencies, with institutional investors investing in digital assets increasing by 6% year-on-year.
Despite a much more than 50% decline in the price level of cryptocurrencies this year, the survey indicates that institutions are warming up to digital assets. Fidelity Digital Assets president Tom Jessop was quoted as saying that during the time when markets are facing sharp economic downturns, especially in recent months.
Jessop added that crypto asset fundamentals may remain strong. He cited the occurrence of cryptocurrencies that have been institutionalized in the market in recent years that have enabled them to face the emergency environment.
The Fidelity study surveyed over 1,000 institutional investors from the US, Europe and Asia. Those investing in digital assets found $BTC and $ETH to be their top picks, with Ethereum shares in the US falling 4% year-over-year.
The organization also discovered that over 65% of survey participants in Asia and Europe owned digital assets, while only 42% did so in the US. Those who have not yet invested in cryptocurrency cited risks such as volatility, security issues and the possibility of market manipulation.
Notably, institutional investors continue to increase their investments in digital assets at a time when the daily aggregate trading volume of cryptocurrency institutional investment vehicles has hit a two-year low.
According to CryptoCompare’s latest Digital Asset Management Evaluation report, digital asset products’ assets under management (AUM) began to recover last month after a “tough September”, with AUM rising 1.76% in October to $22.9 billion as of 25 .October.
According to the firm’s research, this is the first growth in AUM since July this year, and is still significantly lower than the figure seen during this year’s market peak in March. Average daily aggregate product volumes across all crypto investment products fell 34.1% to $62.3 million in October, continuing a steady decline in volumes that began in November 2021 and only temporarily halted with a 0.39% increase in May .
MicroStrategy-like companies hold the top positions as the institutions with the most crypto holdings. It has become more bullish on crypto under the leadership of bitcoin evangelist Michael Saylor. The company announced to raise USD 500 million in September 2022 to allocate the funds to crypto purchases. As of September 2022, MicroStrategy had about 130,000 BTC.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional money exchange systems. She is also fascinated by the blockchain technology and its function.
