According to a recent report conducted by accounting firm KPMG, institutional investors in Canada significantly increased their cryptocurrency exposure last year.
According to a recent report conducted by accounting firm KPMG, institutional investors in Canada significantly increased their cryptocurrency exposure last year compared to the previous bull run. The survey, which received 65 responses from institutional investors and financial services organizations, found that nearly 40% of the participants reported having direct or indirect exposure to crypto assets in 2023, up from 31% in KPMG's 2021 study.
Out of the respondents, 31 identified as institutional investors managing over $500 million in assets, while the remaining 34 were financial services organizations. The survey revealed that one-third of the institutional investors have allocated 10% or more of their portfolios to crypto assets, representing an increase from a fifth two years ago.
The survey highlighted the maturing market and improved custody infrastructure as key factors driving institutional investors to invest in crypto assets. Additionally, financial firms expanding their offerings cited increased client demand for crypto asset services as a significant factor.
The report also revealed that half of the institutional investors surveyed have exposure to crypto assets through Canadian ETFs, close-ended trusts, or other regulated products. Furthermore, 58% of the participants have exposure through the stock market, such as Galaxy Digital on the Toronto Stock Exchange, which is an increase from 36% in 2021. Exposure through derivatives markets also saw a significant rise, with 42% of institutional investors receiving exposure compared to 14% in 2021. The only decline was observed in venture capital or hedge fund firms, falling to 25% from the previous year's 29%.
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