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CoinShares‘ recent survey indicates that Wall Street’s interest in digital assets, particularly Bitcoin (BTC) and Ethereum (ETH), has reached its highest level this year. The survey reveals how investors navigate the evolving landscape of cryptocurrencies, the basis of their decisions, and the defining trends. Notably, the increase in allocations to cryptocurrencies, the reduction of regulatory risks, and a tendency towards broader portfolio diversification are drawing attention.
Wall Street’s BTC and ETH Investments Hit Recent Highs
CoinShares’ Head of Research James Butterfill shared all the findings from a survey involving digital asset fund managers. Seventy-five percent of survey participants view Bitcoin and Ethereum as the assets with the most attractive growth potential. This trend is evidenced by the weight of digital assets in portfolios increasing from 0.4% to 1.3% since the first quarter of 2023, the highest level to date.
Moreover, the decrease in regulatory concerns is noteworthy. Fears related to government bans and regulations have fallen from 63% to 50%, yet investors remain worried about regulatory uncertainty. According to the survey, uncertainty regarding policy mistakes by the Federal Reserve (Fed) has led to changes in investor sentiment.
Bitcoin stands out as the digital asset with the most promising growth outlook in the survey, while Ethereum seems to have lost some sentiment against other altcoins like Solana (SOL) and Polkadot (DOT). However, Bitcoin and Ethereum remain the favorites for 75% of survey respondents, continuing their dominance in the market.
The increase in the weighted average of digital assets in portfolios indicates a general trend of increased allocation. Considering that larger asset managers are making a strategic shift to digital assets, this market change is said to have a significant impact.
Investor Behavior and Emerging Trends
The rise in investor interest is considered speculative and recent price increases have led to a change in perception. The demand surge is linked to clients’ need for portfolio diversification during periods of high stock and bond correlations. Despite a decrease in regulation and volatility concerns, custody and accessibility issues remain significant worries. Approved spot Bitcoin ETFs in the US have eased regulatory concerns, but custody problems and accessibility issues persist among investors without digital assets.
According to the famous cryptocurrency analyst CredibleCrypto, Bitcoin’s technical failure point is at the $38,500 level, and levels just below $40,000 could signal a potential decline. The analyst notes that overall downside risk is limited and Bitcoin should be evaluated over longer time frames. CredibleCrypto emphasizes the importance of staying above the $38,500 level, suggesting that dips could be seen as buying opportunities.
