In its Institutional Investor Digital Assets Outlook Survey published on Nov. 22, Coinbase reported that many professional investors have increased their allocations during the crypto winter.
America’s largest exchange surveyed 140 institutional investors between Sept. 21 and Oct. 27. They represented assets under management of about $2.6 trillion, it added. However, it should be noted that the survey was conducted before the collapse of FTX and the capitulation that followed.
In late October, market capitalization was still around the $1 trillion level, though the industry was in deep bear market territory.
— Coinbase Institutional (@CoinbaseInsto) November 22, 2022
Institutions Looking Long-Term
The survey found that 62% of the participants already invested in crypto increased their allocation over the past year. Just 12% of those surveyed reported a decrease in digital asset allocation.
“This is evidence that institutional investors have continued to take a long-term view of the asset class even as prices have fallen.”
Furthermore, the majority of 58% expect to increase their crypto portfolios over the next three years. Only 6% said they would be decreasing their exposure to the asset class.
Coinbase also reported an overall positive sentiment despite the bear market. 72% of respondents supported the view that digital assets are here to stay. “Given the current climate, this is a strong signal of the acceptance of crypto as an asset class,” it noted.
The short-term outlook was not so optimistic, however. Around half expected crypto markets to remain range bound, and almost a third thought they would decline further over the next 12 months.
When asked about aims and goals, the top three reasons for investing in crypto were cited as “improving funded status, accessing yield opportunities, and investing in innovative technology.”
Just over half said that regulatory uncertainty in the US was their major concern over investing. Coinbase concluded that most institutional investors are taking a long-term view, adding that continued interest is likely to help raise standards and make the asset class more accessible.
Coinbase Stock at ATL
Unfortunately for Coinbase, investors are not interested in its shares at the moment. Company stock (COIN) tanked to an all-time low this week, just below $41 per share. At the time of writing, it was trading at $43.50 after hours. The stock route came as crypto markets tanked to a new market cycle low on Nov. 21.
COIN is currently trading almost 90% down from its all-time high of $357 in November 2021. However, crypto markets are up 2.4% on the day.