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Over half of the Asian affluent possess crypto investments in their portfolio

More than 50 percent of Asian investors have been found to possess digital assets in their portfolio holdings

Published: Jun 7, 2022 04:09:52 PM IST

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Research by Accenture revealed that 52 percent of affluent Asian investors held some form of digital assets during the first quarter of 2022.

Accenture published its research on June 6, which included that digital assets such as cryptos, crypto funds, and stablecoins made up 7 percent of the portfolios of surveyed investors on an average. This figure makes digital assets the fifth-largest asset class for investors in Asia.

The amount allocated by investors to crypto-assets was more than their allocations to foreign currencies, collectibles, and commodities. For some investors, the amount invested in cryptos was either at par or more than they had invested in private equity, venture capital, and hedge funds.

Accenture defines an affluent investor as anyone who manages investable assets ranging from $100,000 to $1 million. The survey was conducted across China, India, Indonesia, Malaysia, Japan, Singapore, Thailand and Hong Kong with over 3,200 clients. Compared to their peers in other countries, investors from Thailand and Indonesia held the largest percentage of digital assets in their holdings.

Accenture’s research indicates that half of the Asian investors already held crypto assets in their portfolio in Q1 2022, and a further 21 percent are expected to invest in them by the end of the year. This means that as many as 73 percent of wealthy Asian investors would possibly hold a digital asset in their portfolio by the end of 2022.

Accenture, however, found that most wealth management firms that provide financial services like planning, investment advice and estate planning to their clients are not as focused on digital assets. Sixty-seven percent of these firms said they don’t plan to offer digital asset management services or products.

“For wealth management firms, digital assets are a $54 billion revenue opportunity— that most are ignoring,” stated Accenture.

Lack of understanding and belief in digital assets, the wait and watch attitude to see what the future holds for the industry, and the operational complexity involved in launching a digital asset were stated as the main reasons for these firms to hold back and, instead, give priority to other initiatives.

The consequence is that investors are forced to seek advice from unreliable sources. Accenture said, “This lack of engagement by firms means many clients are seeking advice about digital assets on unregulated forums, including peer-to-peer advice on social media.” However, Accenture stressed the significance of pushing forward into the digital asset region for wealth management firms.

Crypto adoption rocketed in India and Hong Kong especially, in 2021, as per the Gemini crypto exchange report in April. The report also stated that 45 percent of the surveyors had made their first crypto purchase in 2021.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash