Domestic Listed Altcoins Also Popular: Survey Results on Cryptocurrencies Held by Institutional Investors

As the cryptocurrency market evolves, institutional investors are increasingly diversifying beyond Bitcoin and Ethereum.

A recent survey by Ernst & Young reveals key insights into the types of digital assets these investors are holding and their shifting preferences towards ETFs and altcoins like Solana and XRP.

With USDC emerging as the top stablecoin, these findings provide a glimpse into the future trends in crypto investments.

Survey Findings on Institutional Investors' Cryptocurrency Investments

In recent times, the emergence of Bitcoin spot ETFs and Ethereum spot ETFs has led to an increase in institutional investors venturing into cryptocurrency investments.

Reports indicate that institutional investors from the United States and the EMEA region (Europe, Middle East, and Africa) are holding not just BTC and ETH, but other altcoins as well.

A report published by the major accounting firm Ernst & Young (EY) in May 2024 titled "Will Institutional Investors Approach Digital Assets Similarly in 2024?"

provides detailed insights into cryptocurrency investments among institutional investors in the U.S. and EMEA regions.

37% Engaged in Spot Investments, Shift Towards ETFs and Other Funds Observed

According to this report, as of May 2024, 37% of institutional investors in the U.S. and EMEA are invested in spot cryptocurrencies. It has been observed that there is a gradual shift in investment focus from spot cryptocurrencies to digital asset funds.

Specifically, during the 2023 survey, 51% of respondents indicated plans to invest in spot cryptocurrencies within the next two to three years.

However, this figure decreased to 32% in the 2024 survey. Conversely, the number of institutional investors planning to invest in cryptocurrency trusts or ETFs within the next two to three years increased from 38% in 2023 to 51% in 2024.

Top Two Cryptocurrencies: BTC and ETH Dominate

Bitcoin (BTC) and Ethereum (ETH) remain the most popular cryptocurrencies among institutional investors. In a survey asking respondents to select all cryptocurrencies held by their firms, BTC and ETH overwhelmingly dominated the results.

However, compared to 2023, the number of institutional investors holding ETH has slightly decreased. Bitcoin was held by 94% of respondents in 2023 and 98% in 2024, while Ethereum was held by 88% in 2023 and 78% in 2024.

SOL, XRP, BNB, ADA, and More Also Popular

Despite the dominance of BTC and ETH, 68 out of 119 firms (57%) holding spot cryptocurrencies also reported holding other altcoins. Among these, the following seven altcoins were particularly popular, with Solana (SOL) being held by 24% of the firms:

• SOL
• XRP
• BNB
• ADA
• TRX
• AVAX
• stETH

USDC is the Most Popular Stablecoin

In a survey on the stablecoins used by institutional investors, USD Coin (USDC) emerged as the most popular.

Following USDC, Tether's USDT and PayPal's PYUSD were also widely used, with other stablecoins such as USDD, TUSD, FDUSD, DAI, USDP, and FRAX trailing behind.

Are Institutional Investors Expecting Growth in Altcoins?

While there are concerns that cryptocurrencies other than Bitcoin and Ethereum could be classified as securities under U.S. SEC regulations, institutional investors appear to be optimistic about the growth potential of altcoins like SOL, XRP, BNB, ADA, TRX, AVAX, and stETH.

These altcoins are currently being widely adopted, and the findings of this survey may serve as valuable information for individual investors when considering their investment options.

Additionally, the fact that USDC is the most used stablecoin among institutional investors can also be a useful reference when selecting a stablecoin as a base currency on cryptocurrency exchanges.

Although the altcoin market has been experiencing a prolonged period of price stagnation, some prominent analysts and traders have predicted a significant price increase for altcoins in the near future, making it important to keep an eye on the price movements of various altcoins.

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