Investors in Singapore have greater risk appetite and motivation to invest in crypto relative to their global peers, according to a recent report by digital asset specialist Sygnum.
Nearly 57 percent of Singapore investors plan to increase their allocations to crypto, according to Sygnum’s «Future Finance Report 2024», compared to 47 percent in other countries. Two-thirds of respondents in the city-state also consider their risk tolerance as high compared to just over half of global peers.
Opportunities for exposure to future market upside potential via innovative new asset classes and portfolio diversification were cited as key reasons. Over a third also said that the availability of institutional-grade products and access to regulated service providers were drivers to increase their current exposure.
Market-Specific Risks
In terms of risks, Singaporeans named security and custody as their main focus.
«This suggests that investors are perhaps less worried about short-term asset price volatility and are more concerned with protecting their holdings,» said Gerald Goh, co-founder and CEO of Sygnum APAC. «This may indicate while investors have confidence in the asset class itself, they still seek greater assurance around the infrastructure that supports it.»
Stablecoins and NFT
Demand extends beyond well-established assets like Bitcoin Ethereum with Singapore exhibiting notably higher interest in stablecoins and non-fungible tokens (NFT) compared to Layer 2 tokens.
«The Monetary Authority of Singapore (MAS), having finalised their stablecoin framework earlier this year, has likely reinforced stablecoin's role in facilitating on-chain transactions,» Goh explained. «NFTs are not regulated by MAS, but they do enjoy the status of property under the Singapore High Court. This classification adds a much-needed layer of security and legitimacy to NFTs and is likely a reason for the higher interest compared to other regions.»
Digital Asset Hub
According to Goh, Singapore is making «significant progress on its long-term mission to cement its position as a leading, high-quality hub for digital assets». Noteworthy highlights include the finalization of crypto regulations to further enhance consumer protection, an asset tokenization initiative called «Project Guardian» and the roll-out of sophisticated new hybrid products by traditional financial institutions.
«The city-state's crypto credentials were further validated this year when Singapore’s Token2049 became the world's largest crypto event,» he added.
