Institutional Investors in Canada Increasingly Embracing Crypto Assets: KPMG Survey

Institutional Investors in Canada Embrace Crypto Assets, KPMG Survey Finds

A recent survey conducted by KPMG in Canada and CAASA has revealed that nearly four in ten institutional investors based in Canada had exposure to crypto assets in 2023. This marks a significant recovery from the market slump experienced in 2022.

According to the survey, 39% of Canadian institutional investors reported having direct or indirect exposure to crypto assets in 2023, up from 31% in 2021. Kunal Bhasin, a partner at KPMG in Canada’s Digital Assets practice, noted that while 2022 was a turbulent year for the crypto industry, it had a “cleansing effect” that ultimately led to increased interest in crypto assets among institutional investors.

The survey also found that the number of institutional investors holding cryptocurrencies directly increased to 75% in 2023, up from 29% in 2021. Despite this, exposure to crypto assets through exchange-traded funds (ETFs) remained unchanged, with 50% of investors utilizing ETFs and other regulated products since 2021.

Additionally, the survey highlighted a significant increase in Canadian institutional investors accessing crypto holdings via public equities and derivatives. This trend is expected to continue as the market for crypto assets matures.

Mark Greenberg, Managing Director for Canada at Kraken, expressed optimism about the future of crypto adoption in Canada, noting that interest in cryptocurrencies continues to grow among both individuals and institutions. Analysts also predict a rise in institutional interest in the global crypto market, which could attract pension funds and insurance companies to engage with crypto assets.

Overall, the survey findings suggest that crypto assets are increasingly being viewed as an investible alternative asset class among institutional investors in Canada, signaling a positive outlook for the future of the crypto industry in the country.