Laser Digital Investor Survey on Digital Assets

Key findings

• Investors overwhelmingly regard digital assets as a major part of the investment landscape – 96% of those questioned see digital assets as representing an investment diversification opportunity alongside traditional asset classes such as fixed income, cash, equities and commodities 
• Investors would like to see digital assets more closely integrated with traditional assets. More than nine out of 10 (91%) questioned want to see digital assets combined with other traditional asset classes to produce ‘all-weather’ income strategies to help cope with the risk of inflation and the debasement risk of fiat currencies 
• Around 90% said that it is important to have the backing of a large traditional financial institution for any digital asset fund or investment vehicle before they or their clients would consider putting money into it
• More than four out of five (82%) professional investors interviewed are positive about the digital asset class in general and Bitcoin and Ethereum in particular over the next 12 months. Just 3% of respondents are negative about the outlook for the sector while 15% are neutral.
• Around nine out of 10 (88%) say they or their clients are currently considering investing in digital assets
• Nearly half (48%) regard the Bitcoin and Ethereum as providing a foundation of the Web 3.0 economy and therefore representing a long-lasting source of investment opportunities. Another quarter (26%) believe they represent a long-lasting source of investment opportunities while also being highly speculative assets while 26% view them simply as highly speculative assets
• They are not just focused on the big two cryptocurrencies – 88% of those questioned said they saw value in being exposed to other carefully-chose cryptocurrencies beyond Bitcoin and Ethereum. Just 12% saw no value in expanding into other cryptocurrencies
• Investors reported a wide range of maximum allocations to digital assets under their risk boundaries. More than a fifth (22%) questioned say they can invest up to 5% while 30% can invest up to 4%.
• Nearly half (45%) say their and/or their clients’  total percentage exposure to digital assets will be between 5% and 10% over the next three years and just 0.5% say they will have no exposure
• Our study look at investors’ preferred exposure to the digital asset class and found Momentum at 80% the most popular ahead of Value at 68% and Carry at 61%. However more than three-quarters (77%) said they would favor a risk-adjusted combination of all these factors.

CHALLENGES AND HURDLES

• More than three out of four (76%) say there are legal or regulatory restrictions applicable to them that could prevent their fund or clients investing in a product that references exposure to digital assets.
• Most would have to make regulatory filings or notifications as a result of holding or investing in financial instruments focused on digital assets. Around four out of five (76%) questioned cited this as an issue while another 5% did not know whether they would have to. Just one in five (19%) are confident they would not need to make regulatory filings or notifications.
• In addition, around 82% say they are aware of regulatory filings or notifications that the issuer of digital financial instruments must make as a result of investors holding or investing in their financial instruments.