Institutional Investors Getting Into Crypto Fidelity Survey Finds , Bloomberg Reports

  • Nearly half of investors said digital assets worth owning
  • Concerns include volatility, lack of rules and no fundamentals

Fidelity, which began a custody service to hold Bitcoin for its customers earlier this year, is trying to gauge how pensions, family offices, hedge funds, endowments and foundations feel about owning cryptocurrencies as it builds out its Fidelity Digital Assets business. According to the survey, which questioned 441 institutional investors from November to February, 72 percent prefer to buy investment products that hold digital assets, while 57 percent choose to buy them directly.

“That’s interesting because I’d argue that no one owns dollars or euros in a fund,” Tom Jessop, president of Fidelity Digital Assets, said in an interview. Survey participants said they were concerned about volatility, regulatory uncertainty and a lack of fundamentals to use in determining the right price for Bitcoin, Ether and other digital assets. Jessop noted the survey was done during a bear market in which cryptocurrencies have dropped substantially from their highs in late 2017.

Vancouver-based Quadriga Fintech Solutions Corp., which is going through bankruptcy in Canada, owes 115,000 clients about $193 million in cryptocurrencies and cash after the death of founder Gerry Cotten last year. The continued black marks are likely keeping many traditional investors away from the space for now.

Fidelity Chief Executive Officer Abigail Johnson is hoping to change that, and has been a proponent of digital assets, setting her apart from many rivals. Under her leadership, the firm began mining Bitcoin in 2015. She’s betting Fidelity Digital Assets will appeal to Wall Street’s relatively nascent appetite for trading and safeguarding digital currencies. Jessop echoed those thoughts in the interview.

“People are relying on the institutions they’ve done business with for a long time to fulfill their objectives and needs,” he said. “I’m not trying to throw shade on anybody else, but it’s up to the clients to decide.”

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Source:

https://www.bloomberg.com/news/articles/2019-05-02/fidelity-survey-finds-institutional-investors-are-eyeing-crypto?srnd=cryptocurrencies

Mohsen Daemi
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