Fidelity Sees Historical Record Presence of Institutional Investors on Bitcoin Market
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Oct. 13, 2020

Fidelity Digital Assets, a subsidiary of Fidelity Investments, has issued a new report in which described bitcoin (EXANTE: Bitcoin) as an alternative investment.

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According to Ria Bhutoria, Director of Research at Fidelity Digital Assets, bitcoin currently is a drop in the bucket compared with traditional markets. For example, the CAIA Association sized the alternative investment market at $13.4 trillion in 2018 (12% of the global investible market, sized at $116 trillion).

"If bitcoin were to capture 5% of the alternatives market as measured by CAIA, that would equate to an incremental $670 billion growth in its market size. If it were to capture 10%, that would expand its market size by $1.3 trillion," Fidelity Digital Assets wrote in the report.

The well-known financial services giant also says the current acceptance of bitcoin in institutional portfolios can be compared with the acceptance of emerging and frontier equities in portfolios in the late 1980s and early 1990s.

Fidelity highlights that bitcoin is highly likely to withstand economic problems better than other assets in the coming months and years. Combined with its multifaceted narrative and interesting effect of preserving retail and growing institutional sentiment, it could be a potentially useful and uncorrelated addition to an investor portfolio's toolkit.

In June 2020, Fidelity figured out that over 30% of institutional investors own cryptocurrencies such as bitcoin. Across the US and Europe, 1/3 of the survey’s 774 respondents said they own cryptocurrencies.

Fidelity Top Manager Files for Bitcoin-focused Fund

According to the survey, in the US, over 25% of institutional investors (pension funds, family offices, investment advisers, etc.) own cryptocurrencies, up from 22% about a year ago. In Europe, over 40% of respondents have virtual currencies.

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