Bitcoin News Today: Asia's Ultra-Wealthy Shift 5% of Portfolios to Crypto as Institutional Adoption Rises

Wealthy Asian investors are increasingly allocating a portion of their portfolios to cryptocurrencies, with some planning to dedicate around 5% to the asset class. This trend is being led by high-net-worth individuals and family offices across key financial centers such as Singapore, Hong Kong, and mainland China. Wealth managers in the region have reported a surge in client inquiries, while cryptocurrency exchanges have seen rising trading volumes and strong demand for new crypto funds. Jason Huang, founder of NextGen Digital Venture, highlighted this growth, stating that his firm raised over $100 million in a few months for a long-short crypto equity fund launched in Singapore in May. The fund had previously returned 375% in less than two years.

UBS noted that overseas Chinese family offices are also contributing to the shift, with members of second- and third-generation families beginning to engage in digital assets. The trend reflects a broader institutionalization of crypto adoption, moving beyond the retail-driven growth that has characterized much of the region’s previous engagement with the asset class. In 2024, Chainalysis data revealed that the Central and Southern Asia and Oceania (CSAO) region accounted for over $750 billion in crypto inflows between mid-2023 and mid-2024—about 16.6% of global volume. This growth was largely fueled by retail users, particularly those engaging in small-value transactions under $10,000 for trading, remittances, and DeFi activities.

India emerged as the leader in the Global Crypto Adoption Index, driven by retail investor activity on centralized exchanges. Indonesia followed in third place, with grassroots DeFi participation and a growing Web3 sector. Vietnam and the Philippines also ranked highly, with the latter using crypto extensively for remittances and play-to-earn gaming. In contrast, East Asia has seen a different pattern. The region added nearly $400 billion in crypto inflows during the same period, with professional and institutional investors playing a key role. South Korea, for example, attracted $130 billion, driven by professional traders engaging with altcoins and stablecoins, as well as arbitrage strategies tied to the “kimchi premium.”

Hong Kong has seen the fastest growth, with crypto activity increasing by 85.6% year-on-year. Nearly 40% of inflows were attributed to stablecoins, while the approval of three spot Bitcoin (BTC) and three Ether (ETH) ETFs in April 2024 spurred institutional flows and a shift toward direct BTC and ETH holdings. Meanwhile, in China, crypto activity has increasingly moved to over-the-counter (OTC) and peer-to-peer (P2P) platforms after the 2021 crackdown on exchanges. Wealthy individuals have used crypto to preserve assets and move money abroad, with flows rising in late 2023 as property markets weakened and stock indexes fell.

Asia is also becoming a major center for crypto innovation, hosting 32% of active crypto developers globally, according to the 2024 Electric Capital Developer Report. This figure has grown significantly from 12% in 2015, with 41% of new developers now originating from the region. The region’s growing expertise and investment are reinforcing its position as a global leader in blockchain and digital assets.

Source: [1] Wealthy Asian investors target crypto adoption broadens (https://cointelegraph.com/news/wealthy-asian-investors-target-crypto-adoption-broadens) [2] Asia’s tokenization boom is shifting capital away from the West: Expert (https://cointelegraph.com/news/asia-tokenization-boom-shifting-capital-west) [3] Chainalysis September 2024 report (https://www.chainalysis.com) [4] 2024 Electric Capital Developer Report (https://electriccapital.com)