“Winter of crypto assets” also blows where the wind: Institutional investors’ views are brighter than expected | CoinDesk JAPAN | Coin Desk Japan

Amid concerns over cryptocurrency regulation and the return of a bear market in the United States, an email from the digital asset team at a major international investment bank left me with contradictory indicators and a view of the industry from a purely American perspective. It reminded me of things I shouldn’t see.

The subject line of the email was: “Large International Survey Reveals Pension Funds, Fund Managers and Other Institutional and Asset Managers Are Positive and Plan to Invest in Digital Assets.” I had the illusion that the email was from a parallel world where the opposite of reality was happening.

Speaking to investment firm recruiters who took the stage at Consensus 2023 in May, many of them are now in favor of US Senator Elizabeth Warren’s “anti-crypto legion.” are unable to publicly show interest in crypto assets for fear of being targeted by .

But the research in the email was solid and yielded important results.

Related article: Professional investor interest in crypto assets remains high: survey report

Surprising findings

The research was conducted by Laser Digital. It is a subsidiary of Nomura Holdings, a Japanese financial giant well known on Wall Street. According to the company, the study targeted “pension funds, wealth managers, family offices, hedge funds, investment funds, insurance companies and sovereign wealth funds with a total of $4.956 trillion in assets under management.” I did.

The survey yielded surprising results.

• 96% of respondents view digital assets as an investment diversification opportunity
• 91% believe digital assets can help create a “one size fits all” income strategy to “address inflation risks and fiat currency devaluation risks”
• 82% have a positive 12-month outlook for digital assets in general, especially Bitcoin (BTC) and Ethereum (ETH)
• Only 3% are negative, 15% are neutral about the outlook for the cryptocurrency industry

In summary, it was pointed out that there are issues with the introduction of crypto-assets, and one of them, of course, was regulation. It’s so positive.

bright prospects

Here’s what I learned from the survey results:

• Institutional investors have a deeper understanding and greater confidence in crypto assets than ever before. Respondents’ firm stance on the crypto industry is a sign that many are now well informed. it’s a good thing.
• The survey was international. It contained wide diversity in terms of organizational structure, ownership, geographic location, and so on. That gave me a much broader perspective than hearing from bankers and American fund managers who are closely tied to the language and mindset of Wall Street.
• The diametrically opposed view of crypto assets in financial centers outside the US is partly due to a more constructive approach by governments there. Hong Kong, Dubai, Singapore, London, Bermuda, Switzerland and Paris are financial hubs with connections to various institutional investors and asset managers.
  These cities have taken deliberate steps to create a legal framework for digital assets. They are designed to enable innovation in this area while setting compliance requirements with varying degrees of rigor. Meanwhile, the United States is bogged down in turf wars between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), and between Democrats and Republicans.
• In the “crypto asset winter,” there is a reversal towards integrating blockchain technology into the existing financial system. In particular, the focus is on the tokenization of “Real-World Assets (RWA)”. RWA tokenization has helped attract and retain institutional investor interest. Many institutional investors hold assets that are suitable for tokenization (although it is noteworthy that respondents also expressed interest in Bitcoin as a fiat risk hedge).
• Anxiety in America will disappear. America cannot remain isolated while the rest of the world is making progress.

Cheer up. There is a way out of here.

｜Translation and editing: Akiko Yamaguchi, Takayuki Masuda
｜Image: Shutterstock
｜Original: What Winter? Institutions’ Crypto View Rosier Than You Think