New TradFi Survey: 43% of Institutional Investors Own Cryptocurrencies

But Bitcoin wasn't their top choice for future portfolio allocations. Over the next 12 months, they plan to buy this digital asset instead.

Dear Crypto Asset Investors and Friends,

The institutions are here, and they are buying the dip. Blackrock, the largest asset manager in the world with $10 trillion in assets, just announced its second blockchain ETF, one month after the debut of its first one. Goldman Sachs took on principal risk in a crypto OTC trade for the first time with Galaxy Digital. Goldman Sachs now has a part of its website dedicated to the investment case for cryptocurrencies and the metaverse. The largest hedge fund in the world with $140 billion in assets under management, Bridgewater Associates, announced they were backing a Bitcoin fund. Fidelity is weighing a plan to allow its brokerage customers—some 34.4 million individual investors—to trade the world’s largest cryptocurrency. Citadel, Brevan Howard, Investment Bank Cowen—soon, the list of institutional investors in crypto will be longer than the list not involved. Not only will these institutions bring liquidity to the cryptocurrency space, but they also hold significant power in local politics and governments. Finance, insurance, and real estate lobbyist groups in the US spent $539 million in 2020 on influencing regulation and public policy. 

As institutions join the blockchain ecosystem, the demand for institutional-grade infrastructure is growing. The largest global banks, including JPMorgan Chase, Bank of America, and DBS Bank, have invested in educating themselves on digital assets, and many are already venturing into offering products and services.

The entire technology stack from traditional finance integrates the necessary tools to handle cryptocurrencies. There are custodian banks, market makers, paying agents, and clearing houses establishing themselves as trusted intermediaries for blockchain-based assets.

However, some key questions remain. How much of the cryptocurrency market capitalization and daily trading volume is done by institutions versus retail investors? The answer to this question helps us understand if crypto is mainly a retail phenomenon or if institutions already own a considerable chunk of the market. This report investigates the direction of the capital flow. Are professional traders currently buying or selling Bitcoin? Are institutions primarily interested in Bitcoin, Ethereum, or other methods for gaining exposure to blockchain technology, such as private equity or mergers and acquisitions? Do they plan to increase their exposure to blockchain over the next 12 months? 

To answer these questions, Cointelegraph Research took a data-driven approach in the second annual Institutional Demand for Cryptocurrencies Global Survey 2022 Report. To gain a deeper understanding of how professional investors feel about blockchain assets, this 60+ page research report presents 32 questions about crypto assets answered by 84 wealthy investors across Asia, the US, and Europe. TLDR - 43% currently hold digital assets, and 19% plan to buy them in the future. However, their favorite cryptocurrency for future investment was unexpected. Many institutional investors are already in the market, and new ones join daily. 

The New Crypto Research Report can be downloaded from the following link:

Crypto Research Report – (75 pages) – English

Key highlights include:

• Cointelegraph’s second annual survey found that 43% of professional investors currently hold digital assets, and 19% plan to buy them in the future. Three surveys were done on professional investment in cryptocurrencies in 2022, including studies conducted by Cointelegraph, Bitwise, and Nickel Asset Management. On average, 45% of the institutions surveyed have exposure to cryptocurrencies. 

• In total, the respondents manage $316 billion in assets, 3.3% of which, or approximately $10.43 billion, is invested into cryptocurrencies. 

• Institutional investors, including public corporations and governments, own 1.39 million+ BTC, equal to 7.2% of the circulating supply. 

• Professional investors primarily hold Bitcoin (94%) and Ether (75%). Institutions are also interested in security tokens (31%) and stablecoins (31%). Smaller holdings included Polkadot (DOT) (25%), Solana (SOL) (13%) and Litecoin (LTC) (13%). Several investors mentioned they are also interested in publicly traded blockchain stocks. 

• Institutional investors are more likely to buy Ether than Bitcoin in the next 12 months. 62% of investors say Ether is on their buy list, compared to only 54% for Bitcoin. 

• A slim majority of investors (55%) prefer to hold cryptocurrencies directly. Interestingly, professional investors prefer to buy a regulated fund before buying structured products or trading futures. Active strategies beat out passive strategies by a narrow margin. 

• There are more than 800 digital asset funds across 80 countries. 

  

Thank you to the 22 research partners and contributors from 6 countries that helped produce this report.

sFOX, Ross Soodoosingh, Paige Lohuis, Miranda Herrington, Zeltner & Co, Kim Matthias Wirth, Nicole Zeltner, Aayush Katiyar, Raphael Spannocchi, Alexander Valentin, Michael Tabone, Mark Mason, Silvia Ibarra, Belén Villar, BBVA Switzerland Dr. Alexander Thoma, PostFinance, Irena Mihova, Shyft Network, VeVe, Alex Gonzales, Flavius N., GonnaMakeIt NFT Marketplace, Energi Core, LCX, Monty Metzger, Samaksh Wangnoo, Arin Soleymani, Lisk, Laura Peijs Flow Traders Michael Lie, Phemex , BEQUANT, Frank Chatzigeorgiou, Arsenii Dain, Jason Choi, Sebastian Simonsen, Finoa, Lili-Jane Giordano

Crypto Research Report has a strategic partnership with Cointelegraph, the largest crypto news company in the world. All editions of the Crypto Research Report are available on the Cointelegraph website, which gets over 17 million views a month.

I hope you will enjoy reading Cointelegraph and Crypto Research Report’s latest survey of professional investors’ ownership of digital assets. Please feel to contact us with any feedback or interview requests at research@cointelegraph.com.  

Kind regards from Liechtenstein in the Crypto Rhine Valley, 

The CRR Team

Crypto Research Report
9492 Eschen/Liechtenstein
Mail: info@cryptoresearch.report
Web: www.cryptoresearch.report

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