A recent survey targeting top crypto investors and executives highlights a major change in capital allocation priorities, as 85% of the respondents prefer infrastructure investments to decentralized finance (DeFi) projects.
This shift is made due to the fear of money leaving and the lack of market depth, thus underscoring the industry’s urgent need for strong infrastructure that can handle widespread usage.
Infrastructure is the focus
The survey, conducted by CfC St. Moritz, interviewed 242 people, including institutional investors, founders, and regulators. The respondents indicated that the biggest obstacles keeping institutional capital from entering the crypto markets are the lack of market depth and settlement capacity.
Nearly 84% believed that, when considering the bigger picture, macroeconomics is giving a green light to crypto, but on the other hand, the current infrastructure does not allow for big money to enter the market.
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Liquidity problems
Running out of liquidity was pointed out as the industry’s biggest threat, with the survey respondents simultaneously pointing out the need for market infrastructure improvement.
The concentration on infrastructure matches the general direction of the trends, including increased attention on custody, clearing, stablecoin infrastructure, and tokenization frameworks.
The survey also pointed out a remarkable change in the perception of the US regulatory environment, resulting in the respondents considering it the second most favorable one for digital assets only behind the United Arab Emirates.
The survey results are attributed to the passage of stablecoin legislation and the provision of clearer rules for banks and other regulated market participants.
Summary
In addition, the survey underscored a change in the focus of investments from the move to infrastructure, resulting from both liquidity concerns and regulatory improvements.
With the industry progresses, investors and other stakeholders should put a premium on the creation of a sound infrastructure capable of handling mass adoption and thus the opening of the way for new opportunities.
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