In a recent article from CoinTelegraph, it was reported that 39% of Canada’s institutional investors have exposure to cryptocurrency, according to KPMG. Kunal Bhasin, a partner at KPMG Canada, suggested that the increasing debt and inflation rates have potentially led institutional investors to turn to cryptocurrencies as an investment option. This growing interest in crypto assets among institutional investors in Canada sheds light on the changing investment landscape in the country.
### Reasons for Institutional Investors’ Interest in Crypto
Institutional investors in Canada are increasingly looking towards crypto assets for various reasons, including:
#### 1. Hedge Against Inflation
– Cryptocurrencies are seen as a potential hedge against inflation, especially in times of economic uncertainty.
#### 2. Diversification
– Including cryptocurrencies in their portfolios allows institutional investors to diversify their investments beyond traditional assets like stocks and bonds.
#### 3. Potential High Returns
– The volatile nature of cryptocurrencies presents an opportunity for high returns, attracting investors seeking lucrative investment options.
### KPMG’s Insight on Crypto Investments
Kunal Bhasin’s comments highlight the following insights into institutional investors’ growing exposure to crypto assets:
#### 1. Risk Management
– Institutional investors may view crypto investments as a way to manage risks associated with traditional investments.
#### 2. Long-Term Strategy
– Including cryptocurrencies in their portfolios may be part of institutional investors’ long-term investment strategies to adapt to changing market dynamics.
#### 3. Market Trends
– The current market trends, such as rising debt levels and inflation rates, may be driving institutional investors towards alternative assets like cryptocurrencies.
### Conclusion
The data provided by KPMG indicates a significant shift in the investment preferences of institutional investors in Canada, with a notable percentage now having exposure to cryptocurrencies. This move towards crypto assets reflects a broader trend of diversification and risk management strategies among institutional investors in the evolving financial landscape of the country.