Institutional interest in cryptocurrencies is on the rise, research claims.
A client survey by Goldman Sachs found 40 per cent of institutional investors currently have exposure to cryptocurrencies and 61 per cent expect their digital asset holdings to increase in the next 12 to 24 month.
The investment bank found that Bitcoin was the most popular cryptoasset (42 per cent) followed by Ethereum ether (29 per cent) and stablecoins (13 per cent).
More than a third, 35 per cent, of institutional investors believe spot pricing and volumes data would be the most helpful to better evaluate a potential investment in cryptocurrencies.
Another 29 per cent think the most important factor that drove the recent Bitcoin price action was the macro backdrop, while 57 per cent put it down to positive news, such as institutions investing in or offering additional products.
In 12 months’ time, more than half (54 per cent) believe the price of Bitcoin will be between $40,000 to $100,000 (£28,900 to £72,300) while 22 per cent forecast it will be less than $100,000.
A third of investors believe that regulation, internal investment and mandate permissions are the greatest hurdles to start allocating to digital assets, and 24 per cent believe a lack of well-regulated, investable assets is the greatest hurdle.
“What’s been particularly interesting of the respondents, 40 per cent of the clients currently have exposure to cryptocurrencies,” Matt McDermott, global head of digital assets for Goldman Sachs global markets division, said in a podcast.
“That could be through a variety of different mediums – the physical through derivatives, through securities products, or other offerings in the market. That seemed actually a little high to me.
“But I thought that was kind of very reflective of the demand we’ve seen over the past three to six months.”
McDermott said Goldman Sachs, which is working to go live with its crypto trading desk, fully expects crypto incumbents to continue making huge strides following their progress over the last couple of years.
He added that the underlying technology for the blockchains represents a huge opportunity for the financial services industry.
There are several peer-to-peer lending platforms operating in the cryptocurrency space.
Aave is an Ethereum-based lending platform while JustUs loans can be invested in via purchasing its cryptocurrency BiPs through its sister company Moneybrain.