Fifty-eight percent of those surveyed answered that cryptocurrencies are here to stay. A third of the institutions consulted have invested in cryptocurrencies, thus demonstrating that the reputation of these assets has improved.
In recent days, investment bank JPMorgan published the results of a survey on cryptocurrencies that they applied to 3,400 investors from 1,500 institutions. The study reveals that 11% of the institutions consulted have already invested in Bitcoin and other cryptocurrencies. About 22% of them responded that their organizations would be willing to invest in cryptocurrency-based instruments.
The reputation of Bitcoin and other cryptocurrencies among institutional investors has improved. The fact that a third of the institutions consulted has invested in cryptocurrencies or is willing to do so prove this. However, the survey also indicates that some investors still associate cryptocurrencies with high-risk assets or illegal activities.
When assessing the perception of cryptocurrencies among the respondents, about 14% chose Warren Buffett’s definition: “Probably rat poison squared.” Around 21% of the sample opted to define cryptocurrencies as “a passing fad.”
Positive Opinions about the Main Cryptocurrency on the Market
The remaining 65%, that is, almost two-thirds of the respondents, gave positive opinions about cryptocurrencies. More than half of them claimed that cryptocurrencies “are here to stay.” Meanwhile, around 7% of the investors believe that cryptocurrencies will become “one of the most important types of assets.”
Around 27% of those consulted expressed their individual views on cryptocurrencies. They revealed that they have made personal investments in cryptocurrencies or trade with them.
Regarding cryptocurrency regulations, around 77% agree that they should be stricter. Around 48% think that many fraudulent activities are related to cryptocurrencies. However, 49% consider that fraud appears to a lesser extent with this type of asset.
There was a big boom in institutional investment in Bitcoin and other cryptocurrencies during 2020, according to the results of the JPMorgan consultation. Taking that into account, it would be possible to expect institutional interest in cryptocurrencies to increase considerably in 2021.
JPMorgan’s Recommendations about Bitcoin
It is not the first time that JPMorgan has shown its interest in cryptocurrencies, particularly Bitcoin. However, they recommend investing only a portion of the personal funds to reduce the risk of loss.
Although analysts at JPMorgan advise investing in Bitcoin, they suggest an allocation of 1% of the investment portfolio. Likewise, they consider that cryptocurrencies have their limits on utility because “they are investment vehicles rather than financing currencies.”
The investment firm has said that “investors can add up to 1% of their allocation to cryptocurrencies in a multi-asset portfolio.” In that way, they believe that it is possible to achieve any efficiency gains in the overall risk-adjusted returns of the portfolio.”
Investors remain concerned about Bitcoin’s volatility, which fell by roughly 25% from its all-time high in February. However, the cryptocurrency that Satoshi Nakamoto created has reached USD 51,000 again after a correction following four weeks in the green. At the time of writing this article, the price of Bitcoin is around USD 49,000.
By Alexander Salazar
