A new report from Fidelity shows that institutional actors have doubled their interest in purchasing cryptocurrency futures this year 2020. A foreseeable increase in the economic and financial explosion that is to come to the ecosystem.
The renowned American company Fidelity Digital Assets, specialized in asset management and pension funds, has made public a new report on the state of cryptocurrency markets among institutional players.
In it, Fidelity Digital Assets commented that institutional sentiment and confidence towards cryptocurrencies has improved enormously. A situation that has resulted in the majority of respondents to the new report speaking positively about them.
In the report, Fidelity commented that:
“Digital assets are gaining popularity and attractiveness among institutional investors, with almost 80% of investors surveyed finding something attractive about the asset class. In a comprehensive survey of nearly 800 institutional investors in the United States and Europe. The sample indicates that 36% of respondents say they are currently invested in digital assets, and 6 in 10 believe digital assets have a place in their investment portfolio.”
Which makes it clear that the image of the crypto world has taken an important turn, compared to 2017 and 2018. Part of this attitude can be seen reflected in the state of the markets, which are increasingly optimistic. Fidelity has carried out the research for its report from November 2019 to March 2020. This is a period of high expectations due to the arrival of the third halving de Bitcoin and its impact on the crypto world.
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Companies and institutions empowered and confident in the cryptocurrency ecosystem
Another important point of analysis from the report is that about 36% of respondents (27% in the United States and 45% in Europe) responded that they are currently investing in digital assets. A curious fact is that more than 60% of digital asset purchases were made directly without intermediaries.
This is another key point that tells us that companies trust the operation of the decentralized cryptocurrency system. In comparison, in 2019 only 55% of those surveyed made this type of direct purchase. However, the sector with the greatest growth was futures, where growth has gone from 9% in 2019 to 22% in 2020.
On the other hand, Bitcoin continues to be the digital asset of choice. With more than a quarter of respondents owning BTC, while 11% have exposure to Ethereum. Regarding the prospects for future activity, 91% of respondents responded that they are open to exposure to digital assets. On this point, Americans are more optimistic. In fact, 88% of its respondents are willing to participate in a period of 5 years within the ecosystem.
Given the data, Fidelity Digital Assets president Tom Jessop said:
These results confirm a trend we are seeing in the market towards greater interest and acceptance of digital assets as a new investable asset class. This is evident in the evolving composition of our client portfolio, which ranges from crypto funds to pensions.
Attractive prospects captivate institutional investors
Of course, institutional investors don't just see cryptocurrencies for their enormous liberating and decentralized potential. But rather because of its attractive prospects, including the lack of correlation with other asset classes (36%); an innovative technological game (34%); and high upside potential (33%). Overall, 74% of respondents are attracted to these perspectives. Which only diversify with the strengthening of DeFi and Fintech systems.
Given the growth prospects, it is feasible that in the middle of 2020, we could see a significant rebound in cryptocurrencies. Especially in Bitcoin and Ethereum, the two largest cryptocurrencies in the DeFi space. The momentum will carry the rest of altcoins accordingly, but it always remains to be seen how the unpredictable market will act at the end of it all.
Added to this are other elements specific to investors that are often new to the ecosystem. So they do not react well to cryptocurrency price volatility. In fact, among the biggest obstacles to the adoption of digital assets cited in the survey are price volatility (53%). In addition to concerns about market manipulation (47%). And also due to the lack of foundations to measure the appropriate value of cryptocurrencies (45%). Giving us a clear idea that there are still myths to debunk about cryptocurrencies and their markets.
Of course, the data provided by Fidelity is good news for the crypto community. That now the efforts of cryptocurrencies reach the ears of the giants and that more and more people propose them as an alternative to the current economic and financial system, is always good news.
About Fidelity Digital Assets
Boston-based Fidelity Investments is one of the world's largest asset managers. In a press release, it claims to have more than $7.9 trillion in client assets under management. By 2018, it introduced its digital assets wing to provide custody and trade execution services for institutional investors based in the United States. In December 2019, it created a new entity to serve institutions in Europe.
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