A survey of global institutional investors highlights cryptocurrency and private equity as the top assets for risk-adjusted returns over the next five years. U.S. equities and gold rank among the least appealing options. The findings reflect growing acceptance of digital assets in portfolios.
Nickel Digital Management Ltd., a U.K.-based firm, analyzed responses from 260 institutional investors across the U.S., U.K., Germany, Singapore, Switzerland, Brazil, and the United Arab Emirates. These investors collectively manage $14 trillion in assets. The survey, conducted by market research firm PureProfile, reveals a clear preference for certain asset classes amid evolving market dynamics.
Cryptocurrency topped the list, with 65% of respondents expecting it to deliver the most attractive risk-adjusted returns over the next five years. Private equity followed closely, cited by 61%. European equities and commodities each garnered 53% support. In contrast, U.S. equities received only 43% endorsement, while U.S. investment-grade debt lagged at 38%. Gold fared worst, mentioned by just 9% of participants.
Notably, 108 of the surveyed investors currently hold no cryptocurrency or digital assets but intend to invest within the next two years. Looking ahead, 47% anticipate allocating at least 3% of their portfolios to these assets within three years, and 13% project a minimum of 5%.
"What this research shows is that institutional investors are no longer debating whether digital assets belong in portfolios, but how to access them in a controlled, risk-efficient way," said Anatoly Crachilov, CEO of Nickel Digital Management. He added, "Crypto’s evolution mirrors what we’ve seen in private markets: early growth driven by beta, followed by institutionalization and a focus on risk-adjusted returns."
This shift underscores a broader institutionalization of digital assets, paralleling trends in private markets and signaling reduced skepticism toward crypto's role in diversified strategies.