Binance Research, along with Binance VIP & Institutional, has revealed the results of its Institutional Crypto Outlook Survey. The survey highlights an overwhelmingly positive sentiment towards crypto assets among institutional users, with 63.5% of them anticipating a favorable crypto market in the next year. This positive outlook extends into the next decade, with 88% of respondents expressing optimism.
Emphasis on Use Cases and Regulatory Clarity
The survey identifies that Institutional Users anticipate more real-world use cases (26.9%) and improvements in regulatory clarity (25.3%) as significant factors driving crypto adoption. This trend is notable over higher prices, which only 3.4% of respondents considered as a driver for adoption. This suggests a long-term investment horizon for institutional participants, who seem less concerned with short-term market fluctuations.
Survey Methodology and Key Findings
Conducted from 31st March to 15th May 2023, the survey involved 208 Binance VIP and Institutional users. The study analyzed participants’ demographics and their attitudes, preferences, adoption practices, and motivations regarding cryptocurrency investments. Here are some critical findings:
Crypto Asset Allocation
Despite market events over the past year, 47.1% of investors have maintained their crypto allocation. Interestingly, more than a third (35.6%) increased their allocation during the same period, with only 17.3% reducing their crypto allocation.
Projected Allocation Changes
Looking ahead, half of the respondents plan to increase their allocation in the next year, while 45.7% intend to maintain their current levels. Only a small fraction (4.3%) of investors are considering reducing their crypto exposure.
Bitcoin’s Growing Appeal
Although perceptions of Bitcoin and crypto remained largely unchanged over the past year (47.8% and 44.7% respectively), a larger portion of respondents showed a more positive sentiment towards Bitcoin than the broader crypto sector (47.3% vs. 33.2%). Notably, only 4.8% held negative sentiments towards Bitcoin, compared to 22.1% for crypto in general.
Focus on Infrastructure and Innovation
Investors considered infrastructure as the most critical sector (53.9%), followed by Layer 1 and Layer 2 technologies (48.1% and 43.8% respectively). Specifically, Wallet Innovation, such as self-custody and UX/UI improvements, was deemed important by 51.0% of the respondents.
Potential for large investment returns (42.8%) and gaining long-term exposure to emerging technology (37.5%) are the primary motivators for investing in cryptocurrencies.
Centralized Exchanges remain the top choice for institutional trading (90.5%) and custody activities (58.2%). Liquidity, security, and reputation were identified as the three most crucial criteria for selecting a trading platform.
Institutional Growth in Crypto Assets
“Institutions typically take a long-term horizon when they enter a new market, and our survey indicates that is likewise for crypto assets,” said Catherine Chen, Head of Binance VIP and Institutional. “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.”
This survey is intended for information purposes only and does not constitute investment advice. The full survey report can be accessed here.