Is VC Coin Saved? Family Offices Eyeing High Valuations, Likely to Enter the Altcoin Market

The biggest difference between this cycle and the last is the absence of widely-known applications like NFTs, which has led to a lack of new liquidity entering the market. However, a recent report has revealed that family offices managing substantial assets have shown interest in cryptocurrencies, AI, gaming, and other related topics, indicating that these family offices have recognized the high valuations provided by venture capital institutions. If family offices enter the market, it may help resolve the dilemma of many altcoins lacking support. Is this wishful thinking within the cryptocurrency community, or is there truth to it?

37% of Family Offices Focus on Digital Tech Adoption, Asia Key for Growth

Reports indicate that an increasing number of family offices managing at least $100 million are now seeking "alternative investments" in areas like cryptocurrency, artificial intelligence, and gaming. There are currently 8,030 family offices globally, with their managed assets expected to increase by 189% by 2030, reaching $9.5 trillion.

The report specifically mentions that Asia will be a key focus for the development of family offices, with Singapore hosting this year's Token 2049 event being of particular importance.

Manana Samuseva, founder of the Family Offices Investors Summit (FOIS), said, "The Asia-Pacific region is expected to lead global family office wealth growth, with assets managed in Singapore potentially growing by 10% to reach $5.41 trillion by 2025. This growth is largely attributed to the net inflow of alternative investments, with 37% of family offices expecting widespread adoption of digital tech and 32% focusing on sustainable investments."

"While short-term, profit-centered tech investments have slowed down, the market remains highly sensitive to external factors amid the hype around artificial intelligence. This indicates a shift in the market maturity of digital asset categories with greater accessibility and cultural support," added Manana Samuseva, noting that investors from Generation Z are more inclined to allocate funds to areas that contribute to social progress.

Family Offices Allocating 1% Funds See 16% Increase in Altcoins

"We are in an interesting time for the token economy. Despite the downturn in altcoin markets, new enterprises entering the token market are seeing extremely high valuations set by venture capitalists. This trend is making investments in liquid tokens increasingly attractive compared to early-stage investments, marking a significant shift in the crypto industry," stated Kavita Gupta, founder of Delta Blockchain Fund, at the Family Offices Investors Summit.

The biggest issue with overvalued cryptocurrencies is the lack of actual buying support for the valuation, leading to a supply-demand imbalance. If family offices allocate 1% of their $9.5 trillion funds into the market, that would inject $950 billion in buying power. By deducting the market value of cryptocurrencies excluding Bitcoin, Ethereum, and stablecoins, which is approximately $581.7 billion according to TradingView's Total 3 chart, the market still relies on the future development of practical applications and token value appreciation. Aggressive selling and buying are not beneficial for long-term development.