New Study Sheds Light on Crypto’s Super-Rich

by
Fintechnews Switzerland
My articles My booksMy videos
Follow on:

Over the past decade, the rise of cryptocurrency has created a new class of millionaires and billionaires. The early adopters, investors, business founders, and more broadly, those who bought in early and held onto their investments, became extremely rich, accumulating massive wealth as prices soared.

A new report by wealth and investment migration specialists Henley and Partners, released on September 05, 2023, shares insights into the state of crypto wealth, providing exclusive statistics on crypto and bitcoin millionaires, centi-millionaires, and billionaires.

According to the report, the total market value of crypto stood at around US$1.2 trillion in July 2023. The market had about 425 million users with around 0.02% of these crypto users, or 88,200 crypto investors, being crypto millionaires. The market also boasted 182 centi-millionaires, or high-net-worth individuals (HNWIs) with crypto holdings of US$100 million or more, and 22 billionaires.

Showcasing the prominence of bitcoin, the report reveals that just under half of crypto millionaires (40,500) were holding their fortunes in bitcoin solely. The same trend is observed in the global super-rich league where around the same proportion of centi-millionaires were bitcoiners. As of crypto billionaires, six of the world’s 22 crypto billionaires were found to have amassed their wealth from bitcoin only.

Global crypto wealth statistics, Source: Crypto Wealth Report, Henley and Partners, Sep 2023

Switzerland ranked among world’s best crypto hubs

As part of the report, Henley and Partners produced an index designed to assess and rate the best investment migration options for crypto investors according to these locations’ level of adoption and integration of cryptocurrencies and blockchain technology.

A list of 26 countries was selected based on an assessment of the regulatory, technological, economic, and social factors necessary for the development of the blockchain and crypto ecosystem.

According to the ranking, Singapore currently leads the pack as the top crypto hub. The city-state is being recognized for its innovative ecosystem and supportive community, and ranked at the top of the list in terms of public adoption.

The report also highlights the nation’s beneficial crypto taxes rules for individuals and investors, with no capital gains taxes, and notes that the government has been cooperating closely with all actors, including banks, businesses, and the public, for the optimal development of the national crypto sector.

Sitting at the second place is Switzerland, which is being praised for its well-established crypto infrastructure, robust legal framework, and reputation for privacy and security. However, the country scored relatively poorly in public adoption of crypto, falling behind countries like the United Arab Emirates (UAE), the US and the UK.

At the third position is the UAE. The Middle Eastern country stands out as a leading jurisdiction for crypto investors, boasting a strong public adoption score and vibrant interest in the crypto ecosystem. The regional powerhouse also offers favorable tax policies and a high level of economic stability.

At the fourth, fifth and sixth positions are Hong Kong, Australia and the UK, three jurisdictions that are being recognized for their high levels of crypto adoption and their supportive regulatory landscapes.

Most tax-friendly locations

In terms of taxation, the study found Singapore and the UAE to be the jurisdictions with the best tax regimes for crypto-related activities. Hong Kong, Mauritius and Monaco followed suit.

Looking at investment migration in particular, the report notes that Canada, Malta and Malaysia currently have the most appealing investment migration program options for crypto investors.

Investment migration refers to special programs that allow individuals to gain citizenship or residence rights in return for investments in their host countries.

The report notes that the government of Malta has been working on developing its blockchain ecosystem, focusing in particular on fostering innovation, attracting blockchain businesses, and providing regulatory clarity. Malaysia, meanwhile, is developing into a promising center for blockchain innovation in Asia with a burgeoning crypto community and the emergence of numerous startups.

Crypto Adoption Index, Source: Crypto Wealth Report, Henley and Partners, Sep 2023

Crypto adoption declines

Worldwide adoption of crypto has declined over the past year amid underlying volatility, broad declines in valuations and the series of business collapses that occurred throughout 2022.

The number of traditional hedge funds investing in the asset class fell to 29% in 2023, down from 37% last year, a survey conducted in Q1 2023 by PwC and CoinShares shows. Similarly, a 2023 study run by Goldman Sachs found that interest in crypto from family offices is decreasing. Of the 166 family offices polled, 62% of those that are not investing in the asset class said they have no plans in participating in the future, up from 39% two years ago.

Global consumer adoption is also down, falling well off its all-time highs observed in 2021, new data released by Chainalysis show.

Featured image credit: Edited from freepik

The post New Study Sheds Light on Crypto’s Super-Rich appeared first on Fintech Schweiz Digital Finance News - FintechNewsCH.