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- 71% of institutional investors say they will buy, or invest in, digital assets, a survey by Fidelity Digital Assets showed.
- Over half have already do so, with Asian markets leading the adoption, the survey showed.
- An increasing number of institutions have been expanding their digital asset and cryptocurrency offerings.
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71% of institutional investors say they will buy or invest in digital assets in the future, and over half have already done so, according to a recent survey by Fidelity Digital Assets.
Investors in Asia are leading the way in terms of adoption of digital assets, but US and European institutions are following suit, by expanding their crypto-based offerings, according to the survey, which is part of Fidelity Digital Assets' 2021 Institutional Investor Digital Assets Study.
The survey of 1,100 institutional investors across Asia, Europe and the US found 90% of those institutions with an interest in digital assets expect to include them in their own, or their clients', portfolios in the next five years.
"The expectation that the vast majority of institutions will have some exposure to digital assets by 2026 shows that investors have a deeper understanding of the asset class and have progressed in the three-phase journey from education to adoption," Tom Jessop, president of Fidelity Digital Assets, said.
The survey showed 52% of institutional investors already hold digital assets. Breaking it down regionally, this includes 70% of Asian institutional investors, 56% in Europe and 33% in the US. Last year, 45% of European and 27% of US institutions held such assets.
The vast majority of institutional investors say they now find aspects of digital assets interesting and an increasing amount believe these should be part of a portfolio. The potential of digital assets to significantly increase in value and their independence from more traditional asset classes make them appealing to investors, the survey found.
"Price volatility remains the main barrier to adoption, followed by lack of fundamentals to gauge value and concerns around market manipulation; however, investors cited less concern about complexity for institutions and market infrastructure than previously." the survey found.
As digital assets and cryptocurrencies have soared in popularity over the last year, an increasing number of institutions have added them to their products, especially for those aimed at high net-worth clients. Last week, reports emerged that Bank of America was allowing clients to trade bitcoin futures and Morgan Stanley has invested in crypto firms' digital asset funds such as the Grayscale bitcoin trust.
Others however remain sceptical - just this month, UBS said the crypto bubble could burst as regulatory crackdowns make it an inappropriate investment for professional investors.
Fidelity Digital Assets itself is hiring 100 new employees, as demand for their crypto-related products continues to soar, Bloomberg reported earlier this month.