Key Takeaways
- • A BNY Mellon Wealth Management survey conducted with The Harris Poll in late 2021 found 20% of family offices are actively investing in cryptocurrencies, with another 23% reporting limited exposure.
- • The survey covered 200 family offices managing at least $150 million in assets, including 56 single-family offices and 144 multi-family offices, with half based in the U.S.
- • Family offices cited keeping up with investment trends (70%) as the top reason for crypto investing, while 61% of those with any crypto exposure flagged regulation as a concern.
- • Family offices favored accessible vehicles, with 61% using futures-based crypto ETFs and 59% using digital-currency exchanges such as Coinbase, while only 28% invested in crypto startups and 22% in private placements.
- • Per Oasis Pro Markets CEO Pat LaVecchia, family offices are cautiously allocating, leaning toward bitcoin and ethereum.
Summary
According to a new survey by BNY Mellon Wealth Management conducted with The Harris Poll, 20% of family offices are actively investing in cryptocurrencies, a marked shift for a segment traditionally more conservative than institutional investors. An additional 23% said they had limited exposure to crypto, a third were "exploring" investing, and just under a quarter reported no exposure or interest. The survey, conducted in late 2021, included 200 family offices managing at least $150 million in assets: 56 single-family offices and 144 multi-family offices, with half based in the U.S.
Traditionally, family offices avoided volatile assets such as crypto in favor of wealth preservation. A Fidelity survey conducted from late 2020 through spring 2021 found 47% of family offices held digital asset investments, up from 19% the prior year. According to Pat LaVecchia, CEO of digital-securities broker-dealer Oasis Pro Markets, family offices that passed on earlier opportunities are determined not to miss the next one. He noted one family office had declined to invest in Coinbase when it was valued at $415 million six years earlier; it now has a market capitalization of roughly $40 billion.
Young heirs are also a driver, with 45% of respondents saying next-generation heirs were interested in cryptocurrency. The survey found the most-cited reason for investing was keeping up with new investment trends (70%), while just under half said crypto was a good opportunity and fewer than a third cited low interest rates or inflation. Despite enthusiasm, concerns about regulation (61%) and high volatility persisted among family offices with any crypto exposure.
Among active investors, 72% planned to increase holdings, compared with 22% of those with limited exposure. Family offices preferred widely available channels: 61% used futures-based crypto ETFs, 59% used digital-currency exchanges such as Coinbase, and 42% held crypto directly in cold wallets. Investments in crypto startups (28%) and private placements (22%) were least popular. LaVecchia said family offices remain cautious, with bitcoin and ethereum the most favored assets, summarizing allocations as potentially around 5% rather than 50%.
Traditionally, family offices avoided volatile assets such as crypto in favor of wealth preservation. A Fidelity survey conducted from late 2020 through spring 2021 found 47% of family offices held digital asset investments, up from 19% the prior year. According to Pat LaVecchia, CEO of digital-securities broker-dealer Oasis Pro Markets, family offices that passed on earlier opportunities are determined not to miss the next one. He noted one family office had declined to invest in Coinbase when it was valued at $415 million six years earlier; it now has a market capitalization of roughly $40 billion.
Young heirs are also a driver, with 45% of respondents saying next-generation heirs were interested in cryptocurrency. The survey found the most-cited reason for investing was keeping up with new investment trends (70%), while just under half said crypto was a good opportunity and fewer than a third cited low interest rates or inflation. Despite enthusiasm, concerns about regulation (61%) and high volatility persisted among family offices with any crypto exposure.
Among active investors, 72% planned to increase holdings, compared with 22% of those with limited exposure. Family offices preferred widely available channels: 61% used futures-based crypto ETFs, 59% used digital-currency exchanges such as Coinbase, and 42% held crypto directly in cold wallets. Investments in crypto startups (28%) and private placements (22%) were least popular. LaVecchia said family offices remain cautious, with bitcoin and ethereum the most favored assets, summarizing allocations as potentially around 5% rather than 50%.
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