Finoa’s 2022 Family Office Report gives wealth managers a comprehensive overview of the digital asset space, highlighting the growth opportunities available to investors of all levels of familiarity with crypto. 

The report outlines the developments that have led to increased adoption of crypto-assets in the past few years, following the market expansions and contractions since 2014. It makes a case for crypto as an asset class that has a role to play in a world where monetary policies are fraught with record-high inflation and record-low bond yields. In particular, the paper explores the potential of bitcoin as “digital gold” and explains why it might be the crypto-asset best suited to serve as a store of value and a hedge against inflation.

In 2022, the digital asset space continues to extend beyond bitcoin. While bitcoin’s market capitalization grew in 2021, its share of the overall crypto market sank from 70% to 40%, signaling an increasing interest in other digital assets. Some of this market share was taken by Ethereum (ETH), which grew from 10% to 20% of the crypto market. This was due to its role as the underlying blockchain that is powering most of the decentralized finance applications. The rotation was clear among institutional investors as well: ETH’s share of crypto-backed exchange-traded products (ETPs) and trusts also increased.

In the third part of the report, titled “How to invest in digital assets”, readers can learn about the various active, passive, and yield-bearing investing strategies such as lending and staking, as well as gain an understanding of the current regulatory environment. 

Finally, the paper brings together the different ways of gaining exposure to crypto, such as through ETPs, buying shares in crypto companies, or engaging in direct custody, and draws a comparison between the major funds, as well as detailing the criteria that investors should follow when selecting a custodian. 

It’s undeniable that the entire industry is becoming better funded and more developed, and over half of US and European institutional investors are already investing in digital assets. With so many new financial products on the market, it’s easier than ever to get exposure to digital assets. Direct ownership of digital assets directly through a custodian enables access to yield-bearing strategies at a lower cost than crypto-backed funds and financial products.

Regardless of the strategy or asset type, crypto’s unique barriers to entry make finding the right partner increasingly important. 

Download the report to learn more about how you can safely engage with digital assets and find a partner that can meet your needs.