• Published on 12 October 2023
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Singapore investors focus on crypto as confidence grows

Institutional investors in Singapore are increasingly confident in the outlook for digital assets and believe they should play a significant role in diversified portfolios, according to new global research by London-based Nickel Digital Asset Management (Nickel), an FCA-authorised and digital assets hedge fund manager founded by alumni of Bankers Trust, Goldman Sachs and JPMorgan.

Its study found that 92% of institutional investors and wealth managers in Singapore believe investment opportunities in the sector are attractive on a 12-month view with 44% saying they are very attractive. That confidence is translating into an increasing recognition of the importance of digital assets as a diversifier in well-designed investment portfolios.

The study with institutional investors and wealth managers in Singapore who collectively manage around $281 billion in assets, found growing confidence in regulators is supporting investment. Around 48% believe regulators are very committed to introducing robust regulation while a further 48% believe they are quite committed.

The optimism is feeding through into longer-term support for Bitcoin growth – 76% believe Bitcoin will hit the landmark $100,000 valuation with 56% predicting the price will be achieved within five years.

Nickel’s study was conducted when Bitcoin was around $30,000 and Ethereum around $1,900. Just 8% of investors questioned believe Bitcoin will end the year below $30,000 and 4% say Ethereum’s price will be below $1,900. However, regulatory uncertainty remains the biggest barrier to investing in the digital assets sector for institutional investors who are sceptical. Nearly three out of four (72%) who are reluctant to invest cite worries about regulatory uncertainty while 44% have concerns about volatility and 28% are concerned about security.

Anatoly Crachilov, CEO and founding partner at Nickel Digital said: “Institutional investors and wealth managers in Singapore are increasingly confident about the short-term and long-term direction of the digital assets sector and that is translating into a recognition of the diversification benefits offered by digital assets in portfolio construction.”

Re-disseminated by The Asian Banker