Key Takeaways
- Institutional investors lack confidence in
- Nickel Digital Asset Management surveyed 100 global institutional investors and wealth managers to find out their top crypto concerns.
The research included participants from major countries including the US, UK, UAE, France, and Germany, who together controlled $275 billion in AUM.
Investors are hesitant to join the crypto bandwagon due to concerns about custodial security (76 percent). Nickel Digital co-founder and CEO Anatoly Crachilov stated:
However, our results indicate that security and custody concerns remain a major concern for many other allocators.
Others see the lack of transparency and volatility of digital assets as major obstacles, while others cite the regulatory framework for the crypto market as a major issue.
Despite the poor results, Crachilov noted the entry of large institutions into the market, which could improve security:
“With Fidelity, BNY Mellon, and State Street now in the market, the market infrastructure is strengthened. This increases industry confidence, leading to further allocations to this rapidly growing asset class.”
Earlier this month, Nickel Digital Asset Management asked whether institutional investors planned to increase their crypto holdings. Participants were from the same nations as before.
82 percent of those who have previously invested in digital assets plan to expand their exposure by 2023. 40% said they intend to "dramatically increase their holdings."
The possibility for long-term capital growth is cited by 58 percent of respondents, according to Nickel Digital Asset Management. A surprising 37% indicated they would only follow a big company's lead and invest in crypto if they saw one.
Only 1% of respondents said they would sell all digital assets, while 7% said they should reduce their exposure.
Does institutional investors' lack of confidence have an impact on the market, and if so, why?
