The ongoing cryptocurrency market sell-off has potentially influenced investors’ decisions to get involved as the future remains uncertain. Despite the uncertainty, a section of investors views the bearish conditions as an opportunity to build a foundation for future gains.
In particular, 92% of professional investors believe the current values of popular cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are attractive and highlight a positive outlook for the sector, a new research by Nickel Digital Asset Management shared with Finbold on November 9 indicates.
The research based on feedback from 200 professional investors managing $2.2 trillion in assets across seven countries found that, on the whole, the investors believe that purchasing cryptocurrencies amid the current conditions will likely have better returns in five years.
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At the same time, the research highlighted how professional investors have reacted to the market sell-off, with 56% reducing their holdings. Elsewhere, 14% indicated that they have ‘dramatically reduced holdings’ due to the wide-scale correction. Interestingly, 55% of respondents noted that they had crypto exposure for more than three years, while their long-term experience has been positive.
Most professional investors record positive returns
Regarding returns, about 72% of the investors noted that they had recorded positive gains from their crypto exposure, while 24% rated their returns as ‘very positive’. However, only 6% have recorded losses, with 12% breaking even.
In general institutional investors are central to the last bull market, and their role might be crucial to driving the sector to new highs. Furthermore, amid the ongoing correction, several indicators have emerged, pointing to a possible return of professional investors.
As reported by Finbold on November 3, the amount of stablecoin inflowing into spot exchange has hit a new all-time high. Historically, the metric has been used to gauge market trends by institutions.
Extended market sell-off
However, although the market appeared to stabilize and bottom, most assets have undergone significant selling pressure amid the insolvency crisis affecting the FTX crypto exchange. At some point, the market lost over $100 billion in 24 hours.
Notably, the resulting scrutiny of the FTX’s collapse, especially from a regulatory standpoint, will potentially influence professional investors’ decisions.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
