Fidelity Reveals Majority of Institutional Investors Liked Digital Assets, but There Is a Hook

ByEdward Thompson

Jul 25, 2021

Recently Fidelity Digital Assets conducted a survey, the survey’s results have revealed that 70% of the world’s institutional investors have voiced in the favor of digital assets. Investors who were previously investing in pension funds, public limited companies, who used to buy shares and bonds, and used to invest in endowment funds, now looking forward to investing in the crypto market and digital assets. Fidelity Digital Assets concluded that the next five years will be revolutionary for institutional investors. The recent paradigm shift from traditional institutional investment to digital investment is an alarming situation for traditional institutional funds.

In addition to that, almost 90% of the investors who used to invest in the industry said that they are looking to diversify their investment portfolio by obtaining the ownership of digital assets, including cryptocurrencies. Earlier this week, JP Chase Morgan announced to jump into the crypto world, as bank’s investors were frequently inquiring about the crypto market.

However, it is necessary to mention that people have different opinions about digital assets. Not every participant has shown the same understanding of the digital assets class. One of the representatives of Fidelity Digital Assets told Forbes:

“Some people perceived digital assets as the asset class that is offered and transferred electronically, they referred bitcoins, ether, and stablecoins as examples.” However, the detailed findings and diversity of opinions about the digital assets class will be revealed to the public in the month of September, when the survey will be published.

Moreover, 50 of the survey respondents across the U.S, UK, Europe, Middle East, and the Asia Pacific revealed that they are actively investing in digital markets. However, Asia has the highest adoption rate (71%), because of China’s aggressive involvement in crypto mining and trading.

Almost 56% of European institutions and 33% of the U.S institutions told that they own digital assets to keep their cash flow and revenue stream smooth. It is important to consider that the popularity of the crypto market is not the only reason for institutions and institutional investors to for digital assets.

Another major factor that moved the investment world towards digital is the covid-19 pandemic. Corona Virus outbreak has nearly killed corporate finance and industrial economics. Many companies have filed for insolvency and other companies were looking for new revenue streams. That’s where the crypto market came in handy.

The survey respondents said that fiscal and monetary policies in response to covid-19 played the role of catalyst for institutional investors to opt for digital assets.  Fidelity Digital Assets officials said that the overwhelming trend of crypto regulations is an indicator that institutional investors want to get crypto regulated so they might be able to invest heavily.

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