Investors Boost Crypto Investments to Record Levels, with Bitcoin Driving the Trend

Investor allocations to cryptocurrency have surged to a new high of 1.8% as of April 29, based on recent findings. This uptick is linked to recent price fluctuations and a more favorable market sentiment.

The increase is derived from survey data and corresponding institutional 13F filings, showcasing how various investors—including institutions, individual traders, and wealth management firms—are interacting with different asset classes.

Institutional investors, specifically, have shown an average allocation of 2.5% towards cryptocurrencies, indicating an increasing interest in gaining exposure to blockchain technology.

While individual investors hold the largest overall shares in crypto, the report illustrates a growing dedication from institutions and family offices towards these digital assets.

### Bitcoin Leads the Pack

Bitcoin (BTC) remains the most prominent choice among cryptocurrency investors, with 63% of those surveyed reporting exposure, up from 48% in January. Ethereum (ETH) holds steady in second place at nearly 20%, followed closely by Solana (SOL) at 17%.

Other altcoins, such as Polkadot (DOT), Cardano (ADA), and XRP, have seen minimal representation in investor portfolios, indicating a tendency away from a more diversified crypto investment strategy.

This increased focus on Bitcoin aligns with a reassessment from investors regarding the risks linked to altcoins, alongside a growing comfort level with Bitcoin’s liquidity, infrastructure, and perceived regulatory clarity.

This trend persists despite Ethereum’s ongoing importance and the rising interest in alternatives beyond the leading two cryptocurrencies.

Respondents primarily highlighted diversification (30%) as their main motivation for incorporating crypto into their portfolios, followed by interests in distributed ledger technology and speculative investments.

Although there has been a decline in client demand compared to the last quarter, speculative interest appears to be growing, suggesting a reconsideration of the role of cryptocurrencies in mixed-asset portfolios.

### Concerns Over Volatility and Regulation

Volatility continues to be the major obstacle for new investments in the crypto space, even as Bitcoin exhibits lower volatility than many equities. This ongoing concern underscores a disconnect between how investors perceive risks and the asset’s actual performance in recent turbulent markets, with volatility also cited as the main concern by current crypto holders.

Regulatory uncertainties rank as the second-most significant barrier to entry, mirroring findings from earlier surveys. Investors have also shown concerns regarding reputational risks and a lack of strong fundamentals, though these issues are seen as less pressing.

The report suggests that expectations for reduced regulatory and political risks following earlier executive orders have not materialized. Concurrently, previously mentioned risks, like those related to quantum computing, have become less relevant.

Additionally, the report indicates a wider macroeconomic framework influencing investor outlooks. Despite potential challenges arising from tariff-related economic impacts and fears of stagflation, a growing number of respondents believe that the Federal Reserve’s current policy direction is suitable, although many remain uncertain in their views.