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Crypto appetite among investors in Singapore is surging, according to a new survey by Sygnum.
The global digital asset banking group's 2024 Future Finance survey reveals that 57% of institutional investors in the Little Red Dot plan to increase their crypto holdings next year - higher than the 47% global average.
This rising confidence in digital assets as long-term investors is explained by regulation uncertainty no longer being the top barrier for Singapore investors. 75% believe that regulatory clarity has improved.
Crypto ETFs are another stimulant for increased investment, with 73% stating the products as confidence boosters for the asset class.
"Singapore investors exhibit a higher risk appetite and motivation to invest on average than respondents from other countries," Sygnum said in their report.
However, woes over security and custody are more prominent, with 45% of respondents identifying the topic as a concern. 90% also said that better information would lead them to increase their investments.
In terms of Web3 segments, 71% of Singapore investors showed interest in Layer-1 blockchains, 56% emphasised Web3 infrastructure, and 41% highlighted Layer-2 scaling solutions.
Mutual funds and corporate bonds were favoured as having the most tokenization potential among 47% of those surveyed, while equity and hedge funds were prioritised by 40% and 39% respectively.
41% of investors in the region favour actively managed funds and sector-focused investments to maximize returns by generating alpha while 37% preferred passive market exposure.
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Looking further ahead, investors are optimistic about the crypto market's integration into traditional finance, expecting it to benefit from macroeconomic tailwinds and improved liquidity conditions.
"Within the next 12 months, sentiment flips predominantly bullish (56%), aligning with the anticipation over the next 12 months of accelerated institutional flows due to reduced regulatory risks and geopolitical pressure, as well as more post-US-election stability," Sygnum concluded.
"In 2025, sentiment could quickly turn more bullish and allocations could increase, triggered by loosening liquidity conditions, the continuation of the rate cut cycle and China’s aggressive stimulus packages."
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The BRICS nations, led by China and Russia, are accelerating efforts to reduce reliance on the US dollar in global trade and finance. Cryptocurrencies and blockchain technology are emerging as key tools in this de-dollarization push, even as BIS officials are considering nixing the mBridge project.
Singapore has been making an active push to welcome Web3 projects, particularly tokenization. At a fireside chat on day 2 of the Singapore Fintech Festival (SFF), Chia Der Jiun, managing director of the Monetary Authority of Singapore (MAS), articulated MAS' comprehensive vision for the fintech sector, which aims to establish Singapore as a leading global hub for financial technology.
Its vision encompasses the creation of foundational building blocks to facilitate industry growth, such as interoperable payment systems and enhanced cross-border transaction frameworks through initiatives like Project Nexus, Chia said.
The regulator is focused on unlocking the potential of asset tokenization, working closely with global financial institutions to address industry challenges and scale solutions to commercial viability.
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Also announced at SFF, OCBC is partnering with Singapore’s Land Transport Authority (LTA) to build a blockchain-based conditional payments solution.
As part of the bank's involvement in MAS's Project Orchid, the initiative aims to improve transparency and streamline mobilization advance payments to contractors.
Through blockchain technology, OCBC enables LTA to automate critical upfront payments, which aid contractors in managing substantial initial costs. Mobilization payments represent a percentage of a project's total value.
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Elsewhere
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Blockcast
This week's Blockcast features Aethir co-founder Mark Rydon, who tells Blockhead why he decided to take on the challenges with centralized GPU clouds, such as Google's Stadia, which struggled to provide low-latency gaming services economically.
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Events
Devcon (Bangkok, 12-15 November 2024)
Following Devcon Bogota in 2022, the Ethereum Foundation is set to host Devcon SEA, the 7th edition of its premier developer and community conference.
This landmark event is expected to bring together a diverse group of individuals, including developers, researchers, academics, and community members, to explore the future of Ethereum and its potential to reshape society.
Tickets are available here, with discounts for local builders, students and teachers, and youth.
Consensus (Hong Kong, 18-20 February)
Consensus is heading to Hong Kong, bringing together the industry’s most important voices from East and West for pivotal conversations and deal-making opportunities.
Consensus Hong Kong convenes global leaders in tech and finance to debate pressing issues, announce key developments and deals, and share their visions for the future.
Use promo code BLOCKDESK20 at checkout for a 20% discount on tickets here.
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