Institutional investors are increasingly eyeing digital assets, with nearly 22% of them found already having some exposure to these assets, according to a survey by Fidelity Investments.
The study polled over 400 US institutional investors.
Among those surveyed were pensions, family offices, crypto and traditional hedge funds, financial advisers and endowments and foundations.
Forty per cent of the respondents said that they plan digital asset investments in the next five years.
Of those polled, 47% cited that they see digital assets having a place in their portfolios.
Digital assets include, but are not limited to, cryptocurrencies such as Bitcoin and Ethereum.
Institutional investors and digital assets
Seventy two percent of the respondents were keen to buy investment products that hold digital assets, while 57% said that they want to buy investment products that hold digital asset companies.
Moreover, 57% of the respondents said that they plan to buy such assets directly.
Around seven in ten respondents found certain characteristics of digital assets appealing.
Eight per cent of family offices and 74% of financial advisors view the characteristics of digital assets favourably.
Price volatility, lack of clarity around regulation, limited track record and lack of fundamentals are often flagged as some of the key impediments in cryptocurrency.
The research by Fidelity also offers that 37% of investors prefer to deal with a traditional financial services company, as opposed to 24% happy to deal with a dedicated crypto-focused firm.
Fidelity Digital Assets for institutional investors
Fidelity launched its digital assets company last October, dedicated to bringing cryptocurrencies to institutional investors.
Fidelity Digital Assets president Tom Jessop said: “We’ve seen a maturation of 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.”