Source: Sygnum survey
Compiled by: Wenser, Odaily Planet Daily
Editor's Note: As a 'crypto hub' in recent years, possibly due to the painful experiences of related investment institutions in Singapore during the previous FTX incident, the official stance on crypto regulation in Singapore has always been 'friendly yet cautious.'
Nevertheless, the penetration rate of cryptocurrencies in Singapore is gradually increasing, with more institutional and individual investors turning their attention to cryptocurrencies beyond traditional finance. Following Trump's victory in the US presidential election, a series of potential measures such as Bitcoin strategic reserves have also laid a good foundation for the development of the cryptocurrency market. With the accelerated integration of economic globalization and the mainstreaming of cryptocurrencies now and in the near future, Singapore may become the "hotbed for crypto capital" in 2025.
The following is a financial survey recently released by the well-known asset management group Sygnum, compiled and organized by Odaily Planet Daily, with some content edited.
Singapore Investor Status Survey: 57% of institutional investors plan to increase long-term holdings
Recently, the global digital asset banking group Sygnum announced the results of its annual future finance survey. This survey measures and analyzes the core interests, market sentiment, and trading behaviors of institutional and professional investors active in the cryptocurrency market. The survey included over 400 respondents with an average of more than 10 years of investment experience, including Sygnum's institutional clients, investors, and diverse investment professionals from banks, hedge funds, multi-family and single-family offices, DLT foundations, funds, and asset managers, with a total of 121 local respondents from Singapore participating in the survey.
Gerald Goh, Co-Founder and CEO of Sygnum Asia Pacific, stated: "2024 is filled with positive new developments and countless important moments for cryptocurrencies and the broader digital asset ecosystem. Perhaps the most significant is the launch of the Bitcoin spot ETF after being approved by the US Securities and Exchange Commission—which has significantly accelerated the adoption of digital assets by institutional investors."
The survey shows that Singapore investors have a high enthusiasm for crypto assets: 57% of investors plan to increase long-term allocations to crypto assets, higher than the survey average of 47%. Notably, 30% of investors view unclear regulatory conditions as a major entry barrier, while 45% of respondents mentioned security and custody issues as the main considerations, indicating that the development of the crypto ecosystem has benefited from regulatory progress. In light of this, the report aims to highlight new trends and sentiment changes among institutional investors, reflecting the current market situation and providing references for the future development of the blockchain industry.
Top 3 reasons for investing in digital assets
Regarding investment strategies, the survey shows that most institutional and professional investors in Singapore are increasing their investments in cryptocurrencies, with 57% of respondents planning to increase their allocations to crypto assets. This is primarily driven by long-term confidence in the major trends of cryptocurrencies and their diversification potential, even when the crypto market is in a highly turbulent state.
The primary reason for investing in cryptocurrencies is the desire to tap into the major trends of cryptocurrencies (56%), followed by portfolio diversification (41%) and return on investment (39%);
Even amidst current significant market volatility, 57% of respondents still plan to increase their cryptocurrency allocations; 65% of respondents indicated they have a higher risk tolerance for such assets;
27% of respondents plan to maintain their existing positions, with only 2.5% planning to reduce their respective positions;
37% of respondents cited the availability of institutional products as a reason for increasing allocations.
Additionally, another research report shows that 63% of respondents have a high risk appetite for crypto assets, indicating that most respondents interested in crypto assets are generally more comfortable with their volatility. Meanwhile, 28% of respondents demonstrate a more cautious interest, aiming to invest from a neutral position. Among the 17% of respondents who currently do not invest in cryptocurrencies, most tend to have a medium to low risk tolerance, often mentioning issues such as the lack of trust in the on-chain world and asset volatility. More than a quarter of people are willing to allocate crypto assets in the future, while half have yet to decide on investment, and 20% have no investment plans at all.
Strong demand for information on asset classes
Singapore investors hope to gain better information quality and a deeper understanding of digital assets.
Compared to the global average data of 76%, 90% of Singapore investors stated: "Access to quality information and a better understanding of this asset class will encourage them to increase investment or start investing in cryptocurrencies."
Institutional access barriers
It is worth noting that the report also shows that although regulatory clarity has improved, security and custody issues are now the biggest barriers for institutions in Singapore to adopt cryptocurrencies, with 45% identifying this issue as the main obstacle; a lack of effective information and insufficient understanding accounts for 41%, while asset volatility ranks third, also at 41%. The significant improvement in regulatory clarity brought by the US Bitcoin spot ETF and Ethereum spot ETF has injected considerable confidence for more institutions to join the investment ranks, but market education remains crucial.
75% of respondents stated that they believe regulatory clarity has improved;
73% of respondents believe that cryptocurrency ETFs have increased their confidence in this asset class;
90% of respondents indicated that more comprehensive and complete information would encourage them to increase funding.
Cryptocurrency investment preferences
L1 public chains and Web3 infrastructure are currently the most attractive fields for cryptocurrency investment, primarily driven by trends such as DePIN (Decentralized Physical Infrastructure Networks) and AI.
The top three areas of interest for Singapore investors are L1 (71%), Web3 infrastructure (56%), and L2 (41%);
Respondents ranked the areas of assets with tokenization potential as follows: mutual funds (47%), corporate bonds (47%), equities (40%), and hedge funds (39%);
In terms of investment preferences, the top investment strategies include actively managed investments that generate excess returns (41%), followed by passive income investments (37%) and industry investment exposure in targeted growth areas (36%).
Additionally, 91% of respondents claim to primarily invest in blockchain protocol tokens (such as Bitcoin and Ethereum). This reflects an overwhelming preference for mature assets, which are considered to have lower volatility and are supported by traditional institutions. This interest also extends to other L1 public chain competitors, such as Solana and BNB Chain, as decentralized smart contract platforms and ecosystem infrastructures.
Half of the respondents hold stablecoins, using their non-volatility as a risk hedging tool and as a "main ticket" to enter the cryptocurrency market. Since last year, interest in stablecoins has been steadily growing, possibly due to the maturing regulatory framework for existing stablecoins and the underperformance of many DApp-related tokens compared to mainstream tokens like Bitcoin and Solana.
Notably, the composition of investment portfolios and strategies is becoming diversified: nearly 40% of respondents invest in decentralized application (DApp) tokens, 39% invest in NFTs, and only 13% of respondents invest exclusively in L1 protocol tokens.
Finally, the study shows that if market conditions improve, investors who plan to maintain their current allocations may increase their allocations more quickly, with 46% of investors planning to increase allocations in the next six months, and over 60% of investors are optimistic about investing in the crypto market in 2025.
