Institutional Crypto Outlook Survey

Institutional Investors Believe Real World Use Cases and Improvements In Regulatory Clarity Will Help Drive Adoption
PRNewswireJune 30, 20236 min

Binance Research¬†and¬†Binance¬†VIP & Institutional announced the findings of the Institutional¬†Crypto¬†Outlook Survey, which showed that 63.5% of¬†Binance¬†VIP and Institutional users (“Institutional Users”) surveyed, had a positive outlook on¬†crypto¬†assets over the next 12 months. A vast majority (88%) of respondents expressed a positive sentiment on¬†crypto¬†assets for the next decade.

The survey also found that Institutional Users believe more real world use cases (26.9%) and improvements in regulatory clarity (25.3%) would drive adoption, over higher prices (3.4%). This can be indicative of institutional participation taking on a longer-time horizon and therefore less reactive towards short-term market cycles.

The global survey of 208¬†Binance¬†VIP and Institutional users ran from 31st March to¬†15th May 2023, explored the respondents’ demographics as well as their attitudes, preferences, adoption, and motivations towards¬†cryptocurrency¬†investments. Key findings include:

  • Institutional Allocation:¬†Despite the market events over the past year, the majority (47.1%) of investors had maintained their¬†crypto¬†allocation, and over a third (35.6%) increased their allocation in the same period. Only a minority (17.3%) decreased their¬†crypto¬†allocation.
  • Expected Changes in Allocation:¬†The majority of respondents expect to either increase (50.0%) or maintain (45.7%) their allocation over the next 12 months. Only 4.3% of investors indicated they would expect to reduce their exposure to¬†crypto.
  • More Positive Perception of¬†Bitcoin:¬†While perceptions of¬†Bitcoin¬†and¬†crypto¬†remained largely unchanged in the past year (47.8% and 44.7% respectively), a larger proportion of respondents have turned more positive on¬†Bitcoin¬†as compared to the broader¬†crypto¬†sector (47.3% vs. 33.2%). Similarly, while 22.1% of investors have turned more negative on¬†crypto¬†overall, 4.8% held that sentiment towards¬†Bitcoin¬†specifically.
  • Infrastructure and Innovation:¬†53.9% of investors indicated infrastructure to be the most important sector for them or their fund. This was followed by Layer 1 and Layer 2 technologies (48.1% and 43.8% respectively). When asked about specific areas, just over half (51.0%) said Wallet Innovation (e.g. self-custody, UX/UI improvements) as being important.investing in¬†cryptocurrencies
  • Investment Motivation:¬†42.8% of investors indicated that the potential for large investment returns made the most compelling case for investing in¬†cryptocurrencies. This was followed by 37.5% of investors who believe in gaining long-term exposure to an emerging technology as the primary motivation.
  • Trading Venues:¬†Centralized Exchanges remain the most popular platform for institutional trading (90.5%) and custody activities (58.2%). Liquidity (28.0%), security (26.0%), and reputation (22.5%) were the top three criteria in determining how they select a trading platform.

“Institutions typically take a long-term horizon when they enter a new market, and our survey indicates that is likewise for¬†crypto¬†assets, considering the positive outlook from respondents and how they express more belief in use cases as adoption drivers over prices. These findings match the healthy rate of institutional account growth on¬†Binance, which has increased 89% since the height of the bull market in Q4 2021. We will dive into the report with our users to apply learnings into our product offerings,”¬†said¬†Catherine Chen, Head of¬†Binance¬†VIP and Institutional.

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