Fidelity Digital Assets, a subsidiary of asset management giant Fidelity, carried out a research to understand institutional interest and adoption of digital assets, as well as the key barriers to participation in the digital asset class.
The research was executed in association with Greenwich Associates on behalf of Fidelity Digital Assets and the Fidelity Center for Applied Technology from November 2019 to early March 2020 and close to 800 institutional investors in the United States and Europe(including financial advisors, pensions, hedge funds, high net worth investors, etc) were surveyed. The survey report states that 36% of respondents say they are currently invested in digital assets with 25% invested in Bitcoin while the remaining 11% invested in Ethereum.
Key Points of the Blind Survey
- 36% of institutional investors in the United States and Europe have invested in digital assets. Also 6 out of 10 believe digital assets have a place in their investment portfolio.
- Bitcoin remains the digital asset of choice as 25% invest in Bitcoin while 11% have exposure to Ethereum.
- United States investors allocated to digital assets has increased to 27% from 22% in 2019. 22% of respondents in the United States who invested in digital assets have exposure via futures, which is an increase from 9% reported in 2019 survey.
- 40% of institutional investors believe digital assets belong in the alternative asset class, while 20% of investors believe they belong in an independent asset class.
- 60% of institutional investors who invested buy digital assets directly.
- Factors slowing down institutional adoption of digital assets:
- 53% cited volatility
- 47% raised concerns about market manipulation.
- 45% cited lack of fundamentals to gauge appropriate value.
Commenting on the survey findings, Tom Jessop, president of Fidelity Digital Assets said:
These results confirm a trend we are seeing in the market towards greater interest in and acceptance of digital assets as a new investable asset class. This is evident in the evolving composition of our client pipeline, which spans from crypto native funds to pensions.
Institutional Investors are beginning to find digital assets appealing with almost 80% of respondents finding something appealing about the asset class. This is the second consecutive year that Fidelity is conducting this survey amongst United States institutional investors and marks the first for European institutional investors.