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The Ultra-Wealthy of HK & Singapore Express Interest in Crypto Investments

A recent survey from KPMG suggests that more than 90% of family offices and high-net-worth individuals (HNWI) are either interested in investing in the digital assets industry or have already accomplished it.

Up to 58% of family offices and HNWI respondents to a recent poll are already investing in digital assets, and 34% “plan to do so”, according to a research published on October 24 by KPMG China and Aspen Digital titled “Investing in Digital Assets”.

30 family offices and HNWIs in Hong Kong and Singapore participated in the poll, with the majority of respondents managing assets around $10 million to $500 million.

According to KPMG, the significant adoption of cryptocurrencies by the super-rich has bolstered industry confidence due to a rise in “mainstream institutional attention”.

Additionally, it was mentioned that institutions now have easier access to financial instruments involving digital assets, including regulated ones.

Assuring adherence with the financial authorities’ view that crypto assets are not appropriate for retail investors, Singapore’s largest bank DBS announced in September that it was broadening crypto services on its digital exchange (DDEx) to approximately 100,000 wealth clients who meet the requirements around their income to be classified as accredited investors.

While cryptocurrency exchange Coinhako announced in October that they were one of the select few companies to be granted a license by the Monetary Authority of Singapore (MAS) to provide services related to digital payment tokens, the majority of investors only allocate less than 5% of their portfolio to virtual currencies, primarily in the form of Ether, stablecoins, and Bitcoin.

Hindrances to investment in the sector, according to respondents, include market volatility, concerns surrounding the accuracy of valuation, and a lack of regulatory certainty on digital assets. 

KMPG pointed out that the regulatory coherence of the two countries may be improving: “For example, all virtual asset service providers (VASPs) in Hong Kong will have to apply for a license by March 2024. Singapore is also planning to broaden its cryptocurrency regulations.”

Hong Kong’s securities regulator recently declared its desire to ease existing regulations for cryptocurrency trading and let small-scale investors make direct investments in virtual assets.

The Monetary Authority of Singapore (MAS) has increased access to cryptocurrency trading for authorized investors, and numerous exchanges have received preliminary clearance to offer services related to digital payment tokens in the city-state.

Diogo Mónica, co-founder and president of Anchorage Digital, stated earlier this month that Singapore was chosen as a “jump point” into the larger Asian market because of its robust regulatory framework.

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© Copyright of Novum Global Consultancy Pte Ltd {2020, 2021}. All rights reserved.

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