- 60% of respondents believe that Ethereum will be a better investment in 2023.
- Bitcoin is also seen as one with huge potential, while other coins attracting institutional investors are Polkadot, Cardano and XRP.
- Speculative interest and exposure to distributed ledger technology are the main reasons for the increase.
Ethereum It is the second largest cryptocurrency by market cap, with a market value of approximately $190 billion.
while it lags behind BitcoinWith a market cap of over $482 billion as of January 27, 2023, institutional investors are reportedly more bullish on the cryptocurrency’s prospects in 2023 than in the third quarter of last year.
60% of institutional investors are bullish on Ethereum
According to the latest survey results published Bullish sentiment around top altcoins by institutional investors has increased by 20% since the last survey in October 2022 by digital asset manager CoinShares.
The asset manager reports that 60% of respondents from major wealth majors, family offices, hedge funds and financial advisors believe that Ethereum has a better growth outlook in 2023. In October, when CoinShares published its last Digital Asset Quarterly Fund Manager Survey, 40% of respondents indicated a bullish outlook for the leading smart contract platform.
By comparison, 30% of survey participants were bullish on bitcoin – down from 40% in the previous report. But while most of the big money is betting on ETH, CoinShares highlights that a growing number of investors are investing in both assets.
Other digital assets that institutional investors are eyeing in 2023 are Polkadot, Cardano, XRP, Solana, and Polygon.
Why are institutional investors adding crypto to portfolios?
According to CoinShares, the main reasons behind the increase in interest and investment in digital assets are speculation and the need for exposure to opportunities in the distributed ledger technology ecosystem.
Notably, more clients saw the recent crypto crash (following the collapse of FTX) as an opportunity, directing an increasing number of fund managers to add crypto to their positions. The most popular are bitcoin and ethereum.
Digital assets are still the playground for hedge funds, but the weighting in the portfolio has increased from 0.7% to ATL representing 1.1% of the portfolio. pic.twitter.com/cCCogB3l1j
— CoinShares (@CoinSharesCo) January 26, 2023
But the asset manager says crypto may have an increased correlation with equities with fewer investors citing diversification as a key factor.
,When asked what kept investors from investing in digital assets, it is interesting to note that reputational risk has seen a significant decline while regulation is still an important consideration.,” said CoinShares.