A recent study by KPMG reveals a significant rise in enthusiasm for cryptocurrencies among investors from Germany, Austria, and Switzerland. This uptick in interest follows a tough year for the cryptocurrency market, aligning with the anticipation of the Bitcoin halving event scheduled for mid-April 2024.
The comprehensive survey included around 2,400 private investors who invest in digital assets. Results show a remarkable 54% of these investors now allocate more than 20% of their total investment portfolio to cryptocurrencies. A notable group within these investors commits over half of their total assets to the sector, showing readiness to support the industry for the next three to five years.
Shift Toward Cautious Investment Strategies
Investors entering the market are adopting more careful strategies by conducting detailed evaluations before investing. This cautious approach requires crypto service providers to improve their engagement strategies to convert registered users into active investors. Despite the registration increase on investment platforms, there remains a noticeable gap in active participation.
Security remains a top priority for 82% of investors when selecting crypto exchanges. Additionally, 65% and 62% of respondents consider deposit and withdrawal options and transaction costs important, respectively. Although a third of the respondents believe their crypto investments are relatively safe, the majority still have concerns about market manipulation, regulatory changes, and financial crime.
Leading Cryptocurrencies and Market Trends
Bitcoin continues to be the predominant choice among investors, with 91% holding it, followed closely by Ethereum at 78%. Solana has also increased in popularity, marking a 9% rise from the previous year. The U.S. approval of Bitcoin spot ETFs has also positively impacted the market, attracting significant capital inflows. Despite recent outflows suggesting profit-taking ahead of the halving, the market anticipates reinvestment post-market dip.
The Bitcoin halving, which cuts the supply of new Bitcoins, typically signals the start of a bull market. This event is expected to boost demand significantly. The growth in AI and gaming-related cryptocurrencies further supports a bullish outlook for the market.