Nickel Digital Asset Management carried out a recent survey and found that most institutional investors and wealth managers who currently invest in Bitcoin plan to increase their exposure over the next two years, with the main reason being anticipated increase in valuations. Not only that but 85 percent of those surveyed from institutional investors and wealth managers who already invest in cryptocurrency plan to increase their exposure, while 72 percent expect professional investors in general to increase their exposure or invest for the first time.
Of those surveyed, 56 percent said they anticipated increase in valuation over the next two years, while 21 percent expect the valuation to rise dramatically in 2021. However, 56 percent think there will a slight rise in valuation this year.
Two out of five or 40 percent of those surveyed also want to increase their exposure is their ability to provide a tail hedge against excess monetary supply and currency debasement, as well as a hedge against inflation.
Anatoly Cracholiv, co-founder and CEO of Nickel Digital, a London-based digital investment firm, said there is growing optimism about the sector’s infrastructure improving, which will result in mainstream investors entering the market.
“However, there will be continued large swings in valuations, and this is an expected behaviour for the new technology in the early stage of its adoption curve. The price action for such assets is never meant to be a straight line.
“Only professional investors with a long-term view on the underlying technology should have exposure to this asset class. They also need high-risk tolerance levels and, importantly, to never lose sight of the forest for the trees at times of interim volatility.”