Over Half of Japanese Institutional Investors Plan Crypto Allocation: Nomura Survey

2024-06-24 02:26:30

Sujha Sundararajan

Last updated:

June 24, 2024 06:26 EDT | 1 min read

Japan’s largest investment bank Nomura Holdings and its crypto subsidiary laser Digital, on Monday, released findings from a crypto survey.

The company surveyed over 500 investment managers in Japan, among whom, 54% responded that they intend to invest in crypto assets over the next 3 years.

Over half of those surveyed are motivated to invest in digital assets to some extent in the future, Nomura noted.

Respondents who are considering investing in cryptos highlighted some of the recent factors that drives cryptos’ development. These include the launch of crypto products like exchange-traded funds (ETFs), investment trusts, staking and lending.

Those institutions not considering crypto investments currently, noted some of the barriers including counterparty risks, high volatility and regulatory requirements.

Additionally, 25% of survey respondents have a “positive” impression towards the asset class. Further, 62% noted that they see cryptos as an investment diversification opportunity.

“It was indicated that when investing in crypto assets, the preferred allocation is 2~5% of assets under management (AUM).”

Respondents also expressed interest towards investing in Web3 projects, directly or through venture capital (VC) funds.

Japan Inches Closer to a Streamlined Crypto Policy

Japan is rapidly developing an economic reform bill with notable implications for the crypto industry. Early this year, the government published a legislative proposal that allows venture capital firms and other investment funds to hold digital assets directly.

The inclusion of digital assets in the legal framework not only legitimises their use in institutional investments, but also places the nation as a crypto-friendly jurisdiction globally.

Independent finance news FinanceFeeds released a report in February, highlighting that Japan is a global leader in compliant crypto payments.

Furthermore, in March, Japan’s $1.5 trillion pension fund was actively exploring the potential addition of Bitcoin to its investment portfolio.

Japan has also heavily regulated stablecoins. The country noted that only banks, money transmission services and trust firms can issue stablecoin. Besides, all reserves underpinning the value of the token have to be held in Japanese trust and invested only in domestic bank accounts.

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