Cryptos “top contender” for a “major correction” in 2022

Some 40% of institutional investors recognise cryptos as a legitimate investment option

Bitcoin and other cryptos surrounded by piles of golden coins                                 
Almost 75% of institutions said cryptos are not an appropriate investment for most retail investors.– Photo:Alamy
                                

Cryptos were named as the “top contender” for a “major correction” in 2022.

This is according to a survey conducted on behalf of Natixis Investment Managers, an American French-based global asset management company.

Almost 75% of institutions said cryptos are not an appropriate investment for most retail investors.

However, 28% said they currently invest in cryptos themselves, with almost a third planning to increase their crypto allocation next year.

Out of all the institutions surveyed, including those who already invest in cryptos and those who do not, 8% said they plan to increase their crypto allocation next year.

Big players enter crypto space

This year has seen numerous big financial names enter the crypto space. In July, JP Morgan became the first major US bank to give all its wealth management clients access to cryptocurrency funds.

Then on 19 October, ProShares, a provider of exchange-traded funds (ETFs), launched the first-ever bitcoin futures ETF.

This was followed a few days later by the approval of the Valkyrie bitcoin futures ETF by the US Securities and Exchange Commission (SEC).

Central bank regulation required

The survey also found that around 40% of institutions recognise cryptos as a legitimate investment option, but believe that central banks do eventually need to regulate them.

In the past year alone, the price of bitcoin (BTC) has increased by 167%, according to CoinMarketCap.

The Natixis survey was conducted by CoreData Research, a global market research consultancy, in October and November and 500 institutional investors in several countries were questioned. This included four central banks, more than 20 sovereign wealth funds and more than 150 company pension plans.

The combined total of assets managed by respondents comes in at $12.3 trn (£9.30 trn).

Currency.com contacted Natixis for further comment but has received no response.

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