More than six in ten institutional investors and wealth managers in the United States, United Kingdom, France, Germany and United Arab Emirates who currently have no exposure to cryptocurrencies and digital assets, plan to ” invest in it for the first time in the next year. , according to new data, shared exclusively with City AM today.

In most cases, these will simply be professional investors “testing” the market in terms of operation, infrastructure and liquidity rather than serious investments, according to investment manager Nickel Digital Asset Management, who conducted the study.

Reasons to invest

The main reason given for investing in digital assets for the first time is the long-term capital growth prospects of cryptocurrencies and digital assets, a view cited by 47% of respondents.

Next was 44% who said it was because more companies and fund managers are investing in cryptocurrencies, giving them more confidence in the asset class, and 41% who said that was because the regulatory environment is improving.

One in three people (34%) said it was because it was a good hedge against inflation.

Reason to invest % of investors *
Capital growth in cryptocurrencies 47%
More and more leading companies and fund managers are investing in cryptoassets 44%
The sector’s regulatory environment is improving 41%
They offer a good hedge against inflation 34%
They offer strong portfolio diversification benefits 28%
There will be more crypto-asset focused investment vehicles to choose from 27%
Custody / Security Services Around Cryptocurrency Holding Improve 14%
Market liquidity is increasingly established ten%
* Percentage of institutional investors surveyed who are not currently exposed to cryptoassets and who said this is the reason they would invest for the first time

“The crypto-asset market is becoming increasingly mainstream in the institutional and wealth management sectors,” commented Henry Howell, head of business development at Nickel Digital.

Howell said City AM: “This is due to several factors, including the strong performance of the market during the Covid crisis, more established investors and companies endorsing the market, and the improvement in the infrastructure and regulatory framework of the sector.”