A new survey from Binance Research, the research arm of the world's largest cryptocurrency exchange, has found that most institutional investors are optimistic about the outlook for cryptocurrencies over the next 12 months.
Binance Research conducted the survey from March 31 to May 15, 2023, with 208 global institutional clients and VIP users as respondents. The study, dubbed the “Institutional Crypto Outlook Survey,” explored respondents’ attitudes, preferences, motivations, and adoption towards crypto investments.
A Positive Crypto Outlook
Respondents included a diverse mix of institutional investors with varying levels of experience and assets under management (AUM). Over 48% of participants have more than five years of crypto investing experience. Funds with crypto AUM below $25 million accounted for 52.4% of respondents, while those with AUM above $100 million accounted for 22.6%.
In the outlook category, 63.5% of respondents expressed optimism for the crypto sector over the next 12 months. And when the timeframe was extended to a decade, 88% of respondents indicated a positive outlook for crypto.
When it comes to allocation, 47.1% of participants said they have maintained their crypto holdings over the past year, while 35.6% have increased theirs over the same period. About half of respondents expect to increase their crypto holdings over time, while 4.3% would do the opposite in the next year.
Investor interests focused on Tier 1 and Tier 2 sectors and infrastructure. Around 54% of respondents found infrastructure most important to them or their fund, followed by Tier 1 and Tier 2 sectors at 48.1% and 43.8%. Decentralized applications (dApps) have proven to be the most used in recent months.
Drive Crypto Adoption
Additionally, respondents expressed belief in more real-world use cases and improvements in regulatory clarity fueling the drive for crypto adoption. About 27% asked for more real-world use cases, while 25.3% asked for regulatory clarity.
The need for increased institutional participation through banks and other financial institutions also emerged as another driver of crypto adoption, followed by stronger security like fraud detection and custodial solutions. .
"The findings highlight institutional investors' belief in large-scale ecosystem developments rather than short-term price action to drive mainstream crypto adoption," the report said.