Affluent Asian investors add crypto to portfolios

According to research from Accenture published on June 6, digital assets, which include cryptocurrencies, stable coins, and crypto funds, made up on average 7% of the affluent Asian investors’ portfolios. And 52% of the surveyed investors hold some form of digital asset. An ‘affluent investor’ is defined as anyone that manages investable assets of between US$100,000 to $1 million.

This makes crypto the fifth-largest asset class for investors in Asia, and exceeds their portfolio allocations for foreign currencies, commodities, and collectibles. For some of the investors their crypto holdings were on a par with the amount they invest in private equity/venture capital and hedge funds.

The investors taking part in the survey numbered 3,200 and were located in China, Hong Kong, India, Indonesia, Japan, Malaysia, Singapore, and Thailand. Significantly, the investors with the largest proportion of digital assets were in Indonesia and Thailand.

Some of the investors already held crypto in their portfolios in Q1 2022, but the research highlights the fact that a further 21% are expected to have invested in them by the end of this year, which would push the percentage of wealthy Asian investors holding digital assets up to 73%.

Wealth management firms shy away from digital assets

On the other hand, Accenture’s study showed that wealth management firms have been slow to embrace digital assets, and 67% of them said they had no plans to offer digital asset products or services to their clients. The reasons they gave for ignoring a $54 billion revenue opportunity were as follows: a lack of belief and understanding of digital assets, a wait-and-see mindset, and the operational complexity of launching a digital asset. This leads them to advise their clients to prioritise other products. However Accenture claims this has left investors seeking advice about cryptocurrencies from less reliable sources. It also warned that if wealth management firms didn’t get on board with the digital asset space, they risk being left behind. The 9% of these firms that do offer digital assets have shown that success is possible.

The Accenture report is not the only one indicating a ‘warming’ amongst Asian investors towards digital assets. A Gemini cryptocurrency report published in April, found that crypto adoption skyrocketed in 2021, particularly in countries such as India and Hong Kong. Plus, around 45% of respondents in the Asia Pacific region purchased their first crypto in 2021.

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