Crypto Market Growth Driven by Regulatory Clarity

According to a recent survey by crypto exchange Coinbase (COIN) and consulting firm EY-Parthenon (EYP), regulatory clarity is identified as the primary catalyst for growth in the digital asset industry.

Key Findings

• Survey Participants: 352 institutional investors surveyed from Jan. 13 to Jan. 24, 2024.
• Digital Asset Exposure: 86% of respondents have exposure to digital assets or plan to allocate in 2025.
• Increased Allocations: 84% increased their allocations to crypto and related products in 2024.
• Future Allocations: 59% plan to allocate over 5% of their assets under management (AUM) to cryptocurrencies in 2025.

Regulatory Environment

An improving regulatory framework under the Trump administration is seen as a significant advantage for the digital asset sector, with promises to establish the U.S. as the “crypto capital of the world.”

Altcoins and Stablecoins

The survey indicates rising popularity in altcoins among institutional investors:
– Altcoin Holdings: 73% of respondents hold tokens beyond Bitcoin (BTC) and Ether (ETH), predominantly hedge funds at 80%.
– Stablecoin Utilization: Approximately half leverage stablecoins, using them primarily for yield generation, transactions, and foreign exchange.

Preferred Investment Channels

60% of investors prefer exposure to crypto through registered vehicles such as exchange-traded products (ETPs).

Conclusion

The survey focused on decision-makers in the U.S. and Europe, with global investor participation as well.

Read more: U.S. Crypto Investors Are Still Piling Into Memecoins Despite the Huge Risks: Kraken