Despite the ongoing bear market, family offices and high net worth individuals in Hong Kong and Singapore are eager to invest in crypto or already have holdings.
The wealthy elite of Hong Kong and Singapore appear to be eyeing digital assets with interest after a new report from KPMG suggests that more than 90% of family offices and high net worth individuals (HNWIs) are interested in investing in the digital asset space or already have. he already has.
According to an Oct. 24 report from KPMG China and Aspen Digital titled “Investing in Digital Assets,” as many as 58% of family office and HNWI respondents in a recent survey are already investing in digital assets, with 34% “considering do what.”
The survey took the pulse of 30 family offices and HNWIs in Hong Kong and Singapore, with the majority of respondents managing assets between $10 million and $500 million.
KPMG said that the wide acceptance of cryptocurrencies among the ultra-rich has increased confidence in the sector, fueled by growing “mainstream institutional attention.”
He also noted that institutions will also have greater accessibility to digital asset financial products, including regulated products.
Singapore’s largest bank DBS announced in September that it will expand crypto services on its digital exchange (DDEx) to approximately 100,000 high-net-worth clients who meet the criteria around their income to be classified as accredited investors, to ensure compliance. by the financial authorities. Crypto assets are not suitable for retail investors.
Meanwhile, cryptocurrency exchange Coinhako announced in October that they were among a small number of companies that received a license from the Monetary Authority of Singapore (MAS) to offer digital payment token services.
However, allocations remain relatively small, with most allocating less than 5% of their portfolio to digital assets, primarily Bitcoin.
Respondents mentioned that market volatility and difficulties in accurate valuation and lack of regulatory clarity on digital assets continue to be a barrier to investment in the sector.
“Since digital assets are fairly new, there is still some uncertainty among FOs and HNWIs about investing in the sector, especially in terms of regulation and valuation,” the report’s authors wrote.
However, KMPG notes that regulatory clarity in both countries could improve.
“For example, all virtual asset service providers (VASPs) in Hong Kong must apply for a license by March 2024. Singapore also plans to expand its crypto regulations.”
The Hong Kong securities regulator recently announced that it will allow retail investors to invest directly in digital assets and reconsider current cryptocurrency trading requirements.
Related: Coinbase Wins Approval In Principle For Singapore Crypto License
The Monetary Authority of Singapore (MAS) is expanding cryptocurrency trading to accredited investors and several exchanges receiving preliminary approval to offer digital payment token services in the city-state.
Earlier this month, Anchorage Digital co-founder and president Diogo Monica said his company chose Singapore as a “jumping point” into the broader Asian market because the country has a strong regulatory environment.
“It’s about being in a regime that is friendly to crypto and that companies want to do business with. We’re just institutional, institutions go to Singapore, so we’re close.”