- Billionaires have indicated their interests in crypto investment despite the recent cryptocurrencies crash.
- A Goldman Sachs study revealed that 45 percent of family offices are willing to invest in crypto.
The huge fall in the value of Bitcoin, which also led to the decline of a majority of altcoins over the past few months, has been a cause for concern among investors but not the ultra-rich. As most investors are pulling out of crypto, the ultra-rich are optimistic that digital coins are the future.
Bitcoin, the largest crypto by market cap, started off the year on a positive note. When the year started, Bitcoin pulled in constant increases and reached new highs. However, BTC dipped in mid-April following a comment by Tesla CEO Elon Musk over energy usage and environmental concerns. Since then, Bitcoin has been further losing its value due to other reasons mainly driven by FUD (fear uncertainty and doubt). The crypto asset has shed about 50 percent from its all-time high of nearly $65,000 in mid-April. At the time of writing, the top coin, Bitcoin, is up 4.29 percent and is trading for $32,162.
Goldman Sachs study shows increased crypto interest among ultra-rich
Despite the fall, a study by Goldman Sachs showed that the crypto interest of family offices- firms in charge of managing billionaire’s funds is increasing. These family offices help manage the money of prominent names. Jack Ma of Ali Baba and Google co-founder Sergey Brin are also some of the billionaires whose funds are managed by family offices. According to the Goldman Sachs report, a minimum of 45 percet of family houses has maintained an interest in crypto and are willing to invest in cryptocurrencies.
The crypto interest in family offices is growing despite these firms usually putting their client’s money in traditional and profitable investments. Some of the conventional investments family offices rely on are real estates, private equity, and investment funds. Regardless, the Goldman Sachs report revealed that billionaires are beginning to be attracted to the growth of cryptocurrencies.
The report stated that 15 percent of family offices have already invested their clients’ funds into crypto. In addition, a separate 45 percent is considering investing in the crypto space in the future. This means that 45 percent of the ultra-rich have interest in crypto investment. A Bloomberg report noted that these family offices see crypto as a hedge for “higher inflation, prolonged low rates, and other macroeconomic developments following a year of unprecedented global monetary and fiscal stimulus.”
Billionaires optimistic on the future of crypto
Partner & Global co-head of private wealth management at Goldman Sachs, Meena Flynn, commented on the increasing interest of the ultra-rich in crypto. The Goldman Sachs executive said that the billionaires are moving towards cryptocurrencies because they believe crypto assets are the future. Flynn explained that respondents of the survey showed interest in the digital asset space. She added that several family offices want to discuss “blockchain and digital ledger technology. The executive spoke further on the belief of some of the respondents that
This technology is going to be as impactful as the internet has been from an efficiency and productivity perspective.
Family offices have increased as a result of the growing number of tech billionaires. Globally, family offices assets are estimated at nearly $6 trillion, according to researcher Campden Wealth.