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Canada-based institutional investors significantly increased their crypto exposure last year compared to the last bull run, a survey from accounting firm KPMG has revealed.
Nearly 40% of institutional investors reported having direct or indirect exposure to crypto assets in 2023 — up from 31% in KPMG’s 2021 study, the company <a href="https://kpmg.com/ca/en/home/media/press-releases/2024/04/institutional-adoption-of-cryptoassets-jumped-in-2023.html" target="_blank" rel="noopener nofollow">according </a>to an April 24 report. 
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 Source: KPMG
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KPMG received 65 responses, 31 of which identified as institutional investors with most managing more than $500 million in assets, while the remaining 34 were financial services organizations. 
The survey found that one-third of the institutional investors have allocated 10% or more of their portfolios to crypto assets — up from a fifth two years ago.
Kunal Bhasin, a partner and leader at KPMG Canada’s Digital Assets practice said it “appears” the firms are looking to invest in alternative asset classes that act as a debasement hedge and a reliable store of value in the face of increasing inflation and rising debt in the United States.
A large majority of investors cited a maturing market and improved custody infrastructure as key reasons behind investing in crypto assets while increased client demand for crypto asset services was cited as a key factor for financial firms expanding their offerings.
Canada’s world-first approval of spot Bitcoin and Ethereum exchange-traded funds (ETFs) in February 2021 helped local investors become “increasingly attracted” to the asset class, noted Kareem Sadek, another executive at KPMG’s Digital Assets practice. 
But the recent <a href="https://cointelegraph.com/news/sec-spot-bitcoin-etf-approvals">approval of spot Bitcoin ETFs</a> in the United States marked a “milestone moment” for many market participants in Canada, Sadek added.
Related: <a href="https://cointelegraph.com/news/kpmg-in-canada-adds-btc-and-eth-to-its-treasury">KPMG in Canada adds BTC and ETH to its treasury</a>
The report found that half of the institutional investors surveyed have crypto asset exposure through Canadian ETFs, close-ended trusts or other regulated products, while 58% have exposure through the stock market — such as Galaxy Digital on the Toronto Stock Exchange — up from 36% in 2021.
More institutional investors are also receiving exposure through derivatives markets — now at 42% compared to 2021’s 14%. 
The only <a href="https://cointelegraph.com/news/gamefi-vc-funding-fomo-last-cycle-but-vcs-say-its-different">fall came from venture capital</a> or hedge fund firms, falling to 25% from 2021’s 29%.
Magazine: <a href="https://cointelegraph.com/magazine/blockchain-fundraising-airdrops-presales-ico-alternatives/">7 ICO alternatives for blockchain fundraising: Crypto airdrops, IDOs &amp; more</a>

39% of Canada’s institutional investors have exposure to crypto: KPMG

Cointelegraph

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