Almost Three-Quarters Of High Net-Worth Investors Have Exposure To Cryptos

Technology consulting company Capgemini recently released the “World Wealth Report” for 2022, denoting that 71% of the high net worth individuals (HNWI) have made crypto investments. The survey polled 2,973 global HNWIs, with 54% reporting a wealth band ranging from $1 million to $30 million and 46% reporting wealth of $30 million and over.

Capgemini asked HNWIs about their investment preferences for digital assets like cryptos, NFTs, metaverse products, and crypto ETFs. It turns out that younger high net-worth individuals (under and around 40 years old) have an increased interest in crypto assets, with 9 out of 10 respondents confirming they have invested in crypto assets. Furthermore, crypto ETFs and metaverse products have been a weapon of choice, alongside cryptos.

However, crypto investments do not take a large portion of investor portfolios, as data from the survey shows that HNWIs have only allocated around 14% into “alternative investments,” which include crypto alongside commodities, currencies, private equity, and hedge funds.

Wealth management companies embrace cryptos

Despite the relatively low share of crypto investments in HNWIs portfolios, institutional players like the wealth management industry are seeing an influx of investments into digital assets, increasing the overall demand for educational capabilities.

“The influx of new investment avenues such as sustainable investing and digital assets is having a crucial impact on the wealth management industry. Wealth management firms must prioritize providing timely education around this trend to retain their customers.” Nilesh Vaidya, Capgemini’s head of retail wealth management, noted.

Banks joining the race

Banks, especially those who are serving high net-worth individuals, are already starting to turn their heads toward embracing the new crypto economy, as investment bank Morgan Stanley introduced exposure to Bitcoin (BTC) for its millionaire clientele in March 2021, with only those holding $2 million or more in capital able to invest.

BBVA Switzerland also granted access to crypto trading and custody services for private banking clients, with Wells Fargo pushing out a similar offer in 2021.

The long road for the survey

Capgemini’s survey comes after earlier research by Accenture, which revealed that 52% of wealthy investors in Asia held some form of digital asset during the first quarter of 2022. The amount equals to roughly 7% of the surveyed investors’ portfolios.

However, Accenture also found that wealth management companies have been lagging behind to adopt investment products with cryptocurrency or digital asset exposure, with a majority saying they have no plans to offer related services.

The crypto havoc normalizes

After the wave of high correction, the crypto market seems to have calmed down, with most of the top-100 projects recording price increases. Bitcoin is down 1% on the day, but its downwards motion did not stop a project like Cardano and Solana, for example, to gain 5-6% daily.

Despite the push towards a higher ground, the overall crypto market sits way below the $1 trillion mark, currently at $912.5 billion.