High-Risk Appetite and Long-Term Confidence Drives 57% of Institutional Investors to Raise Crypto Allocations: Sygnum Future Finance Survey

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• 57% of institutional and professional investors plan to increase long-term crypto
  allocations, demonstrating their high-risk appetite and growing trust in digital assets
• 65% of respondents remain bullish long-term, with 63% planning to allocate more
  funds in the next three-to-six months
• Exposure to the digital asset megatrend is the primary reason to invest in digital assets, with nearly 30% viewing them a superior investment to traditional assets
• Regulatory uncertainty has been replaced by asset volatility and security as respondent’s top investment barrier

Zurich, November 14 — Sygnum, a global digital asset banking group, has revealed the results of its annual Future Finance survey which measures and analyses the core interests, market sentiment and behavior of institutional and professional investors active in the crypto market.

“Like the previous year, 2024 was one of new developments and watershed moments for crypto and the broader digital asset ecosystem. Among the most important is perhaps the approval and the subsequent launch of the US Bitcoin Spot ETFs, which has the potential to accelerate the institutional adoption of digital assets,” says Martin Burgherr, Sygnum Bank Chief Clients Officer. “This is why we are pleased to present Sygnum’s Future Finance 2024 survey report that highlights these new trends and sentiment shifts among institutional investors. It “takes the pulse” of the current state of the market, as well as offering a preview of the sentiment and plans for the next wave of institutional crypto market entrants.”

Conducted among over 400 respondents in 27 countries possessing an average of 10+ years of investment experience, the survey included a diverse range of investment professionals from banks, hedge funds, multi- and single-family offices, DLT foundations, funds, and asset managers. One third of the respondents are Sygnum clients and investors.

“This report tells the story of progress and calculated risk, the use of a diverse set of strategies to leverage opportunities and most of all, the continued belief in the market’s long-term potential to reshape traditional financial markets” says Lucas Schweiger, Sygnum Digital Asset Research Manager and report author.

63% of respondents assessed their risk appetite as high, with the overall number who assessed their risk appetite as high or very-high increasing from the 2023 survey. More than half of respondent portfolios had in excess of 10% allocated to digital assets, although percentages varied by investor type.

Investment Strategies

• Single token investments (44%) remain the preferred strategy, followed by actively managed exposure (40%).
• 57% plan to increase their crypto allocations, with 31% planning to do so in the next quarter, and 32% in the next six months. Only 5% plan to decrease their allocations, and 2% remain undecided.
• The 36% who plan to maintain their positions may be awaiting further market confirmation or optimal market entry timing. However, with nearly half (46%) considering additional allocations in the next six months, the recent market rally may have accelerated some of these plans.
• The top motivation for investing in crypto is exposure to the crypto megatrend (62%), followed by portfolio diversification (52%) and access to a safe haven or macro hedge (45%).

Market Outlook

• 43% of Sygnum’s respondents signalled short term neutral market sentiment, likely due to Q3 2024’s macroeconomic uncertainty, rumours of the US government following Germany’s lead in selling seized Bitcoins, as well as rising geopolitical tensions. This may have changed after the US elections.
• 65% of respondents remain bullish long-term, with 63% planning to allocate more
  funds in the next three-to-six months.
• 71% expressed increased confidence in the asset class following the approval of the Bitcoin and Ether spot ETFs.

Institutional Barriers to Entry

Historically, traditional investors looking to invest in digital assets were challenged by their strict fiduciary responsibilities and investment mandates, as well as limited access to properly regulated crypto asset custodians. However as regulatory clarity is perceived to be on the rise (69%), asset volatility (43%) has become the biggest barrier to institutional crypto adoption.

• Concerns about security and custody remain high (39%).
• 81% said that better information would lead them to invest more. This suggests that investors may be turning their attention from regulatory matters to market specific risks, strategic planning and technology deep dives.

Crypto Investment Preferences

• The highest area of interest is Layer-1 (76%), fueled by growth in Bitcoin, Solana and other scalable protocols.
• Web3 infrastructure has emerged as the second most attractive crypto investment area (55%), propelled by the growth of Decentralised Physical Infrastructure (DePIN) and AI.
• DeFi has seen declining interest (33%), possibly due to regulatory challenges, security concerns and the more than USD 2.1 billion lost to vulnerabilities and hacks in 2024. Although traditional yields outperformed DeFi during high interest rate periods, DeFi’s attraction for investors may improve with changed market conditions.
• Direct token investments are the most attractive investment product (72%), followed by a rise in demand for ETPs/ETFs (47%) following the US Bitcoin and Ether spot ETF launches.
• In the 2023 survey, real estate was the most popular tokenized asset of interest. This has now been overtaken by equity (44%), corporate bonds (41%), and mutual funds (40%). Real estate has now dropped to seventh place, potentially due to the inherent complexity and limited development of these assets to date.

For more detailed information and insights, download a copy of the Sygnum Future Finance 2024 Report here.

ENDS

About Sygnum
Sygnum is a global digital asset banking group, founded on Swiss and Singapore heritage. We empower  professional and institutional investors, banks, corporates and DLT foundations to invest in digital assets  with complete trust. Our team enables this through our institutional-grade security, expert personal service  and portfolio of regulated digital asset banking, asset management, tokenization and B2B services.

In Switzerland, Sygnum holds a banking license and has CMS and Major Payment Institution licences in Singapore. The group is also regulated in the established global financial hubs of Abu Dhabi, Luxembourg and Liechtenstein.

We believe that the future has heritage. Our crypto-native team of banking, investment and digital asset  technology professionals are building a trusted gateway between the traditional and digital asset  economies that we call Future Finance. To learn more about how Sygnum’s mission and values are shaping  this digital asset ecosystem, please visit sygnum.com and follow us on LinkedIn and X.

Media contacts
Dominic Castley, Chief Marketing Officer
[email protected]
Sygnum Bank AG, Uetlibergstrasse 134a, 8045 Zurich, Switzerland

Disclaimer
The information in this publication pertaining to Sygnum Bank AG (“Sygnum”) is for general information purposes only, as per date of publication, and should not be considered exhaustive. Sygnum expressly disclaims all liability that may be based on such information, omissions, or errors thereof. This publication does not consider the financial situation of any natural or legal person, nor does it provide any tax, legal, investment advice, recommendation, offer or invitation by or on behalf of Sygnum to purchase or sell any assets.