coindesk.com
57% of institutional investors in Sygnum's 2024 survey plan to boost crypto allocations amid the bull run.
65% of respondents are bullish long-term as bitcoin hits new highs.
69% see regulatory clarity, but asset volatility remains a key concern.
With the current crypto bull run, the good news just keeps rolling in, and global digital asset banking group Sygnum's latest annual survey is no exception.
The survey released on Thursday revealed that institutions are ready to put bigger bets on digital assets, with a striking 57% planning to ramp up their cryptocurrency exposure, fueled by a growing willingness to take risks and long-term confidence in the asset class.
The annual survey gathered insights from over 400 institutional and professional investors, possessing an average experience of over 10 years and spread across 27 nations.
"This report tells the story of progress and calculated risk, the use of a diverse set of strategies to leverage opportunities and most of all, the continued belief in the market’s long-term potential to reshape traditional financial markets” Lucas Schweiger, Sygnum Digital Asset Research Manager and report author, said in the press release shared with CoinDesk.
Wave of optimism
A notable 65% of the survey respondents are bullish in the long-term, with 63% mulling more allocation to digital assets in the next three-to-six months.
Meanwhile, 56% of respondents said they expect to change their outlook to bullish within a year, while some already turned optimistic from bullish as bitcoin (BTC) recently hit all-time highs.
BTC has risen over 20% in seven days, setting new highs above $93,000 on optimism that President-elect Donald Trump would offer regulatory clarity to the digital assets industry. On a year-to-date basis, prices are up over 110%, with the January debut of U.S.-listed spot ETFs drawing in billions in investor money.
Over 70% of the survey respondents said these ETFs have increased their confidence in the asset class. Nearly 30% said that digital assets are superior to traditional investments.
Preferred strategies
More than half of respondents had over 10% of their funds in crypto, while nearly 46% considered boosting allocation in the next six months, while 36% planned to maintain the status quo, awaiting the optimal market entry.
Single token investments, or purchasing and holding a single cryptocurrency rather than diversifying into several ones, remained the preferred strategy for 44% of respondents, followed by 40% for actively managed exposure.
Layer-1 blockchains remained the highest area of interest, followed by Web3 infrastructure and DeFi. Tokenization of equity, corporate bonds and mutual funds are now more popular than real estate, which topped the charts in 2023.
Entry barriers
Traditionally, stringent fiduciary responsibilities, investment mandates, and limited access to properly regulated crypto asset custodians were primary entry barriers for investors seeking exposure to digital assets.
However, with 69% of respondents perceiving increased regulatory clarity, asset volatility has become the primary concern, followed by security and custody worries.
For 81% of respondents, access to better information would have them consider boosting allocation. It's a sign that the focus is now more on market-specific risks, strategic planning and in-depth research of technology rather than just regulatory issues, the report said.