Institutional investors and wealth managers in the UAE expect to grow their exposure to cryptocurrency assets between now and 2023, according to a new survey by London-based Nickel Digital Asset Management.

Ten institutional investors, or half of those surveyed, aim to considerably increase their exposure to cryptocurrency assets between now and 2023, and another ten stated that they will add the asset class to their portfolio, the survey stated.

Institutional players have increased their crypto investments following the latest market slump. Players like Ark Investments and Rothschild Investments have been gaining exposure to Bitcoin by investing actively in regulated instruments like the Grayscale Bitcoin Trust (GBTC).

Based on CoinShares’ latest Digital Asset Fund Flows report, cryptocurrency funds attracted $2.9 million in net inflows in the week ending July 19, increasing the total so far this year to $5.7 billion. Nearly 73 percent of this has been put into Bitcoin. According to the report, about $37 billion has been invested in cryptocurrency funds around the world.

Extreme price swings, on the other hand, are frequently identified as a major barrier to institutional investors entering the crypto market.

The UAE government has yet to issue legislation governing cryptocurrency trade and use. However, this has not stopped investors from entering the market. Besides, a number of exchanges have gained legal permission to operate in the Abu Dhabi Global Market.

A majority of UAE-based investors mentioned long-term capital appreciation as the reason for investing in crypto in a recent Nickel study. Furthermore, investors pointed out that cryptos offer a broader liquidity pool, and that the improving regulatory framework is a positive development.

Earlier this month, the United Arab Emirates announced that it will launch its first digital currency by 2026.