More Institutions Are Holding Crypto Despite Falling Volumes, Survey Finds

A survey conducted by Fidelity Investments has found that nearly 60% of institutional investors said they were invested in digital assets in the first half of the year, despite institutional investment products’ trading volumes dropping to a two-year low.

According to Bloomberg, Fidelity Investments survey found that four-in-fie investors believe that investment portfolios should include cryptocurrencies, with the figure of institutional investors invested in digital assets representing a 6% increase from last year.

The survey suggests that institutions are warming up to digital assets, despite the more than 50% drop in cryptoasset prices so far this year. Tom Jessop, president of Fidelity Digital Assets, was quoted saying:

While the markets have faced headwinds in recent months, we believe that digital assets fundamentals remain strong and that the institutionalization of the market over the past several years has positioned it to weather recent events.

Fidelity’s study surveyed more than 1,000 institutional investors across the U.S., Europe, and Asia. Those investing in digital assets revealed that $BTC and $ETH are their most popular choices, with ownership of Ethereum in the U.S. having dropped 4% year-over-year.

The firm also found that over 65% of respondents in both Asia and Europe owned digital assets, while only 42% did in the U.S. Those who aren’t yet investing in crypto pointed to risks including volatility, security concerns, and market manipulation potential.

Notably, institutional investors are increasing their bets in digital assets at a time in which the daily aggregated trading volume of institutional cryptocurrency investment products has fallen to a two-year low.

As reported, according to  CryptoCompare’s latest Digital Asset Management Review report, digital asset products have seen their assets under management (AUM) start to recover last month following a “painful September,” as AUM rose 1.76% in October to $22.9 billion, as of the 25th.

The firm’s report notes that this is the first increase in AUM since July of this year, and that the figure is still significantly below what was seen during this year’s market peak in March. Last month, the average daily aggregate product volumes across all crypto investment products plunged 34.1% to $62.3 million in October, in the continuation of a downward trend in volumes since November 2021 that only briefly stopped for a 0.39% rise in May.

The report adds that October was the second month since September 2020 in which average daily volumes fell below $100 million.

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