Survey: 71% of high-net-worth individuals have invested in digital assets

High-net-worth individuals (HNWIs) have embraced cryptocurrencies and other digital assets, with 71 percent of wealthy individuals investing in digital assets, according to a new survey.

On June 14, technology consulting firm Capgemini released its 2022 World Wealth Report. The company conducted a survey of 2,973 high-net-worth individuals around the world, 54% of whom said their wealth ranged from $1 million to $30 million, and 46% said their wealth was $30 million and above.

The survey asked about investment preferences for emerging asset classes such as digital assets, categorizing them as cryptocurrencies, related exchange-traded funds (ETFs), non-fungible tokens (NFTs), and metaverse-related products.

Of the roughly one in seven wealthy individuals who invest in digital assets, the largest number are under the age of 40. More than 90% of people in this age group have invested in digital assets. The younger group said that cryptocurrencies are their favorite investment, and crypto ETFs and metaverse products are also very popular with them.

However, cryptocurrencies do not make up the majority of portfolios, with HNWIs, on average, only allocating about 14 percent to “alternative investments,” which include cryptocurrencies and commodities, currency private equity and hedge funds.

However, Capgemini observed that the wealth management industry is seeing an influx of investment into digital assets, which "increases the need for educational capabilities."

Nilesh Vaidya, head of retail wealth management at the firm, said:

“The influx of new investment channels, such as sustainable investing and digital assets, is having a critical impact on the wealth management industry. Wealth managers must prioritize providing timely education around this trend to retain their clients.”

Some firms have understood this trend and hope to gain a first-mover advantage in this niche by launching investment products geared toward this demographic.

Investment bank Morgan Stanley introduced bitcoin exposure to its millionaire clients in March 2021, with only those holding $2 million or more in capital able to invest.

Private banking clients of BBVA’s Swiss branch also received cryptocurrency trading and custody services, while Wells Fargo offered similar services in 2021.

Previously, a study by Accenture showed that 52% of wealthy investors in Asia held some form of digital assets in the first quarter of 2022, accounting for an average of 7% of the portfolios of investors surveyed.

Similarly, Accenture also found that wealth managers have been slow to adopt investment products that offer exposure to cryptocurrencies or digital assets, with the majority saying they have no plans to offer related services.