New research conducted by Fidelity Investments suggests that institutional investors are increasingly making space for digital assets in their portfolios. The report published earlier today says that 22% of the investors that were surveyed confirmed that they had some exposure when it came to virtual assets. Interestingly 40% said they were open to taking the plunge in the next five years.
Many of those that confirmed they had exposure revealed that their investments had been made over the past three years. The research aimed to understand how investors, financial advisors, and institutions perceived digital assets. When queried about their investment portfolios, 57% said that they preferred to invest in digital assets directly while 72 percent were in favor of investing in products that hold virtual assets.
The research saw the company poll over 400 institutional investors in the US including family offices, pensions, financial advisors, endowments, foundations and crypto, and traditional hedge funds.
Commenting on the findings of the research, Tom Jessop who is the president of Fidelity Digital AssetsSM said that the crypto sector was experiencing maturity especially when it came to an interest in digital assets “from early adopters, like crypto hedge funds, to traditional institutional investors like family offices and endowments.”
“More institutional investors are engaging with digital assets, either directly or through service providers, as the potential impact of blockchain technology on financial markets – new and old – becomes more readily apparent.”
However, price volatility, lack of fundamentals and lack of regulatory clarity were among the chief reasons that deterred institutions from investing in digital assets.
“Price volatility, which was a primary concern of survey respondents, may dampen as the underlying custody, trading and financing infrastructure continues to develop in a direction that traditional market participants are familiar with.”
What’s your take on this report that indicates that 22% of institutional investors have exposure to digital assets? Share your thoughts in the comment section below.