Survey Reveals Nearly 40% of Institutional Investors Had Crypto Exposure in 2023

A recent survey by KPMG in Canada and the Canadian Association of Alternative Assets & Strategies indicates that nearly 40% of institutional investors had exposure to crypto assets in 2023. This marks a significant increase from 31% in 2021.

The survey highlights that a third of respondents now allocate at least 10% of their portfolios to crypto assets, compared to only a fifth two years ago.

Institutional Investors Enter Crypto Amid Maturing Market

The survey explored the factors driving institutional interest in cryptocurrencies. The majority, 67%, cited the maturing market and improved custody infrastructure, up from just 14% in 2021. Additionally, 58% pointed to the strong market performance of cryptocurrencies as a motivating factor.

The performance of major cryptocurrencies like Bitcoin and Ethereum has been impressive. Bitcoin saw a 150% increase in 2023 and is up nearly 60% year-to-date. Ethereum also experienced a 60% rise in 2024.

The approval of spot Bitcoin exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC) in January has significantly boosted institutional access to crypto assets. This decision came after years of unsuccessful applications, facilitating the inclusion of cryptocurrencies in institutional portfolios.

Growing Interest Among Financial Advisers

A poll by the Digital Assets Council of Financial Professionals showed a notable rise in financial advisers planning to recommend crypto investments to their clients. The survey revealed that 35% of respondents intend to suggest crypto-related opportunities, up from 21% at the end of the previous year.

This increased interest has led to broader coverage of digital assets by major firms like JPMorgan and AllianceBernstein, fostering more sophisticated discussions between investor relations (IR) professionals and institutional investors. IR teams have observed a shift towards more advanced conversations regarding cryptocurrencies.

Surge in Crypto Interest in Hong Kong

Hong Kong has also seen a rise in crypto interest, supported by regulatory clarity and recent approvals of Bitcoin and Ethereum spot ETFs. OSL Group, a digital assets company listed in Hong Kong, has reported a significant increase in investor interest, prompting a more proactive investor relations approach.

Hong Kong launched its first batch of cryptocurrency-focused ETFs, potentially competing with popular Bitcoin products in the US. Harvest Global Investments Ltd., along with a partnership between HashKey Capital Ltd. and Bosera Asset Management (International) Co., listed Bitcoin and Ether ETFs in the city on Tuesday.