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November 25, 2020

In Conversation With

How pensions, endowments and foundations feel about digital assets with Fidelity Digital Assets

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Fidelity surveyed 800 institutions in the US and Europe, the results of which reveal that one-third of clients are already allocated to digital assets and 80% find something appealing. Ria Bhutoria, director of research at Fidelity Digital Assets, provided more insight on which segments found digital assets appealing, saying:

(27:48) “What we found was that actually 80% of pensions surveyed find something appealing. About 50% of endowments and foundations and 100% of crypto hedge funds and venture funds found something appealing about digital assets. And there were multiple characteristics that they could have selected. The top three were that digital assets are uncorrelated, they are an innovative tech play and they provide high potential upside.”

On whether demand for digital assets is growing beyond bitcoin and Ethereum, Bhutoria said:

(30:57) “Certainly, crypto hedge funds and venture funds are interested in digital assets beyond bitcoin and Ethereum. But if you look beyond that to more institutional investors like pensions, endowments, family offices, financial advisors and so on, their interest is heavily focused on bitcoin since it’s the largest and oldest digital asset. It has the most mature infrastructure including increasing support from legacy institutions.”

Fidelity’s interest currently is in custody and expanding trade execution.

(33:47) “From a broader industry perspective, we’ve seen explosive growth in stablecoins. Fidelity Digital Assets was born out of a research lab. And at any given time, that lab is evaluating different parts of the industry and we’re continuing to explore and research the space. So we’re definitely keeping a pulse on interest in adding support for stablecoins and whether there is interest in lending and borrowing, we’re keeping a pulse on that.”

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Gerelyn Terzo
Gerelyn caught wind of bitcoin in mid-2017 and after learning about the peer-to-peer nature of Satoshi's creation has never looked back. Previously she covered institutional investing and fintech for several major trade publications. Gerelyn resides in Verona, N.J.

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