Why 99% of Asset Managers are Investing in Crypto: Exclusive Survey with Amberdata and SDX

A massive 99% of asset managers are allocating at least some of their portfolios to cryptocurrencies, according to our DigiAssets report. The first-of-its-kind research project surveyed 100 of the most senior figures in the digital assets space and was carried out in association with Amberdata and SDX. The report examined the trends in asset management, the transformative potential of blockchain, and the growing interest in asset tokenisation.  

In this article, we outline some of the key findings.

Read the full report for free here

Asset Managers Embrace Crypto  

Our survey reveals a surprising shift – nearly all respondents (99%) allocate some portion of their portfolios to cryptocurrencies. Notably, a significant number (35%) allocate between 11% and 20%, with some even exceeding 30%. This suggests a growing recognition of crypto as a viable asset class.  

However, challenges remain. Talent shortages and a lack of clear regulations hinder broader adoption. Encouragingly, though, regulatory bodies are starting to engage with the industry, suggesting a potential turning point.  

Data-driven insights are also gaining traction, with 47% of firms already incorporating digital asset data analytics into their decision-making, and a further 34% planning to do so within a year. This highlights the growing importance of data in navigating the digital asset landscape.  

Blockchain Revolutionises Traditional Finance  

The survey delves into the perceived impact of blockchain technology, which remains the backbone of digital assets. Smart contracts and automation are seen as the most transformative aspects (79%), promising to streamline processes and reduce errors. Regulatory compliance (64%) and settlement and clearing (48%) are also seen as areas ripe for improvement through blockchain's secure and transparent record-keeping capabilities.  

However, integrating these solutions with existing legacy systems and a lack of skilled professionals are identified as hurdles. Security remains a major concern, emphasising the need for robust security protocols.  

Despite these challenges, there is cautious optimism. Half of the respondents view blockchain-based solutions as moderately mature and accessible, suggesting steady adoption.  

Tokenisation Democratises Investment

The final chapter in our report explores asset tokenisation, a process of converting traditional assets into digital tokens on a blockchain. This technology has the potential to unlock new investment opportunities and boost market efficiency by making previously illiquid assets more accessible. 

The survey reveals strong interest in tokenising various asset classes, with hedge funds leading the pack (71%), followed by fixed-income (54%) and private equity (51%). Real estate (43%) and commodities (34%) also show promise.  

While enthusiasm is high, implementation is in its early stages. Half of the respondents are partially implementing tokenisation solutions, while pilot programs are also prevalent. This indicates ongoing development and experimentation with the technology.  

Improved transparency (64%) and enhanced market access (63%) are seen as key benefits. Greater accessibility (59%), fractional ownership (44%), and reduced settlement times (44%) are also viewed as significant advantages.  Security concerns (61%), privacy and data protection (57%), and scalability issues (48%) are identified as challenges. Integrating with legacy systems (42%) is another potential hurdle.  

The Future of Digital Assets  

The survey paints a picture of an industry on the cusp of significant change. Asset managers are embracing cryptocurrencies, blockchain is poised to revolutionize traditional finance, and asset tokenization offers exciting possibilities for democratizing investment. While challenges remain, the potential for a more efficient and inclusive financial ecosystem is undeniable.