Wealth managers and institutional investors see digital asset adoption as a strategic priority for their organisation and have increased their allocations over the past 12 months, analysis from Brava Finance has shown.

Its research found that 92 per cent of wealth managers and institutional investors viewed digital asset adoption as a priority, with 58 per cent saying it was an urgent and immediate priority.

More than four fifths (83 per cent) had increased their allocations to digital assets over the past year.

Nearly half (44 per cent) had increased their allocations by between 5 and 10 per cent, while 35 per cent had increased it by up to 5 per cent.

Bitcoin's strong long-term performance, despite recent volatility, was cited as a driver for greater allocation by 94 per cent of respondents, including 27 per cent who said it had triggered a serious, strategic reappraisal of policy.

Almost all (95 per cent) either already had or were developing a digital asset strategy, with Brava Finance expecting allocations to rise over the next 12 months.

Close to half (46 per cent) of wealth managers and institutional investors said they would increase their allocations to digital assets by between 5 and 10 per cent, while 37 per cent expected to make increases of between 10 and 25 per cent.

The primary driver for starting digital asset strategies was improved risk-adjusted returns, cited by 59 per cent of respondents, followed by the fear of being left behind by those who had already implemented strategies (56 per cent).

Two fifths (40 per cent) cited the search for diversified sources of yield, while the same proportion pointed to pressure from clients or trustees.

“The research proves what we have known for some time – that institutional investors and wealth managers around the world have identified digital assets as a credible alternative for delivering diversification and risk-adjusted returns,” said Brava Finance CEO and founder, Graham Cooke.

“We anticipate considerable growth over the coming years as institutions become more open about using digital assets to meet their clients’ funding objectives.”

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