62% of institutions to start investing in crypto within a year: Survey

Institutional investors are increasingly looking to move into cryptocurrency investment to grow their revenues in the long term, a new survey revealed.

As many as 62% of global institutional investors with zero exposure to cryptocurrencies like Bitcoin (BTC) said they expect to make their first investments in cryptocurrencies within the next year, according to a new survey by European investment manager Nickel Digital Asset Management.

Released Tuesday, the survey interviewed 50 wealth managers and 50 institutional investors across the United States, the United Kingdom, France, Germany and the United Arab Emirates. Nickel conducted the survey online in May and June 2021.

According to the survey results, the main reason for institutional investors' first cryptocurrency investment is the potential capital increase in the long term, with 47% of respondents citing this factor. Forty-four percent of respondents cited growing confidence in crypto as an asset class with corporates and fund managers increasingly investing in cryptocurrencies.

Forty-one percent of respondents also indicated that they were willing to invest in crypto for the first time due to the improved regulatory environment, while 34% considered crypto as a good hedge against inflation.

“There is no doubt that the crypto assets market is becoming more mainstream in the institutional and wealth management sectors,” Nickel’s head of business development, Henry Howell, said. According to the exec, the growing institutional adoption is driven by several factors including solid market performance during the COVID-19 crisis and growing corporate involvement as well as the industry’s improving infrastructure and regulatory framework.

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The survey further reconfirms the growing institutional adoption of the crypto industry. According to a report by European digital asset manager CoinShares, institutions have been increasingly accumulating crypto holdings for five consecutive weeks as of mid-September.

In July, Nickel released a survey suggesting that the biggest reason stopping institutional investors from moving into crypto was the security of crypto custodial services, followed by the regulatory environment and crypto volatility.