In its latest edition of the World Wealth report, Capgemini said that there is a growing interest of high net worth individual (HNWI) in cryptocurrencies.
According to the World Wealth Report 2018 (WWR) released last week, HNWI wealth surpassed the US$70 trillion threshold for the first time in 2017, registering 10.6 percent growth – making 2017 the second-fastest year of HNWI growth since 2011.
“The new report also highlighted the anticipated entry of BigTechs into wealth management as well as growing HNWI interest in cryptocurrencies, which reached an all-time high market capitalization in January 2018,” Capgemini said.
The report said that cryptocurrencies currently do not constitute a major part of HNWI portfolios, but underscored the “growing interest in cryptocurrencies as an investment tool and store of value.” The enthusiasm for this emerging asset class reached new heights in 2017.
“HNWIs are cautiously interested in holding cryptocurrencies, with 29 percent globally having a high degree of interest, and 26.9 percent saying they are somewhat interested. Cryptocurrency’s potential for investment returns and as a store of value are driving HNWI interest, with 71.1 percent of HNWIs aged 40 and below placing high importance on receiving cryptocurrency information from their primary wealth management firms, compared to 13 percent of HNWIs aged 60 years and above,” it said.
The report said that regulation will play a significant role in shaping the future of cryptocurrencies. However, it added that younger HNWIs are likely to force wealth management firms to develop a point of view.
“Wealth management firms have been ambivalent when it comes to providing cryptocurrency information to HNWI clients, with only 34.6 percent of HNWIs globally saying they have received cryptocurrency information from their wealth managers.”
