Bitcoin security still a concern for some institutional investors

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UK-based crypto fund Nickel Digital Asset Management published a survey of 100 global wealth managers and institutional investors to uncover the biggest investor concerns associated with crypto.

The survey includes respondents from the United States, France, Germany, the United Arab Emirates and the United Kingdom, who collectively hold $ 275 billion in assets under management.

Conducted online from May to June 2021, the survey found low institutional investor confidence in crypto security, with 76% of respondents citing concerns about the security of custodial services as one of the factors preventing them from invest in crypto.

Respondents also identified the regulatory environment as a significant barrier. Other significant concerns included a lack of transparency and volatility, and a perceived lack of reputable fund managers offering crypto investments.

Nickel Digital co-founder and CEO Anatoly Crachilov said institutional concerns about the safekeeping and security of cryptocurrencies arise despite the industry seeing very strong progress on this front. Crachilov said that crypto service providers are increasingly deploying sophisticated cryptographic solutions, such as distributed keys and multi-party compute vaults, while traditional financial institutions have also embarked on such services.

Related: BNY Mellon Joins State Street To Service New Crypto Exchange

We are now seeing Fidelity, BNY Mellon and State Street entering the market, further strengthening the market infrastructure. All of this increases confidence levels in the industry and leads to ever increasing allocations to this rapidly growing asset class, Crachilov said.

The new investigation comes shortly after the Australian Securities Exchange issued a custody warning on centralized cryptocurrency exchanges, warning investors of cybersecurity risks in the form of theft by hackers .

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