Institutions Are Still Bullish on Crypto: Fidelity Survey

Bitcoin may be trading for 70% less than the all-time high of $69,044 it touched last year during the red hot bull market—but that doesn’t mean big investors are no longer interested. 

That assumption is challenged by a survey by Boston-based investment giant Fidelity. The firm today revealed that 58% of institutional investors were invested in digital assets in the first half of 2022—a 6% increase from the year before. 

And 74% of institutions said they were planning to buy digital assets in the future, an announcement by the firm said, while 51% have a positive perception of digital assets—up from 45% in 2021.

“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 Digital Assets President Tom Jessop said. 

Fidelity to Roll Out Ethereum Trading for Institutions Next Week

After starting with Bitcoin, $4.5 trillion asset manager Fidelity is now turning to Ethereum. “Institutional Ethereum capabilities are coming to the Fidelity Digital Assets platform on October 28, 2022,” Fidelity Digital Assets said in an email sent to its clients. The offering will only be available for Fidelity’s existing institutional clients who already trade or custody Bitcoin, which the firm provided services for beginning in 2018.  Fidelity has long since shown an interest in crypto asset...

But it’s worth noting that the survey period ended in June; investors were still plugging lots of cash into crypto investment funds in the first half of this year, despite a dip in prices. 

Things may have changed since then, as the price of Bitcoin and every other cryptocurrency has plunged further. At the end of June, hundreds of millions of dollars were pulled out of Bitcoin funds for traditional investors. 

Fidelity’s survey included 1,052 institutional investors spread across the U.S., Europe and Asia. “Institutional investors” refer to hedge funds, financial advisors and high-net worth individuals. 

Bitcoin—and the wider crypto market—exploded in value in 2020 and through the end of 2021 largely because of institutional investors. MicroStrategy, a software company, decided to put the biggest cryptocurrency on its balance sheet. Other major companies and investment firms followed suit, leading to a price surge. 

Though the price of Bitcoin has dropped this year, MicroStrategy has continued to snap up the cryptocurrency: the company dropped hundreds of millions of dollars on the asset, bringing its holdings up to 130,000 BTC—$3 billion-worth.