In brief
- Cryptocurrency insurance firm Evertas surveyed US and UK institutional investors.
- All told, 90% of those surveyed expect to increase their cryptocurrency investments.
- Respondents cited expected regulatory improvements and increased liquidity as reasons.
A new report from cryptocurrency insurance company Evertas suggests that institutional investors plan to increase their focus on crypto assets in the next five years.
Evertas surveyed investors that oversee some $78.4 billion worth of collective assets, and 64% of respondents reported that they expect a slight rise in crypto investments from the likes of pension funds, family officers, insurers, and sovereign wealth funds.
Meanwhile, a further 26% of respondents believe they will “dramatically” increase their investments in Bitcoin and other cryptocurrencies over the next five years. All told, that’s 90% of surveyed institutional investors that expect some increase in crypto holdings in the next half-decade.
According to the report, the survey was conducted in July by market research company Pureprofile and included 50 total institutional investors, split evenly between the US and UK.
Asked why they anticipate increased exposure to crypto investments, 84% of respondents said that improved regulatory infrastructure will make them more viable, while 80% said that the expanding crypto market will improve liquidity.
Furthermore, 76% added that they believe there will be more mainstream financial services companies and fund managers getting into crypto, and the same percentage said that they believe negative interest rates and yields on bonds will also push them into (or further into) crypto asset investments.
Even so, there is still lingering concern from the surveyed investors about investing in cryptocurrency. Per the report, some 56% of respondents said they were “very concerned” about the lack of suitable insurance coverage options for crypto investments, while 54% were likewise “very concerned” about the working practices and compliance procedures of crypto companies who provide services to institutional investors.
Ultimately, the insurance angle is what Evertas is promoting here, since that’s the firm’s bread and butter. Evertas raised $2.8 million in seed funding earlier this year to further develop its crypto insurance products, in a round led by Morgan Creek Digital.
“A lack of adequate insurance for the crypto assets market is clearly top of the list of concerns for many institutional investors, which is perhaps not surprising when insurers are only providing capacity of around $2 billion for a market that is worth between $250 billion and $300 million,” said Evertas president and COO Raymond Zenkich, in a release. “We are working closely with the insurance community to address this issue.”