(Kitco News) – The cryptocurrency market has struggled to get back into bull market mode over the past six months, but the persistent questions about ‘when higher’ belies the significant growth already recorded in 2024, as evidenced by The Crypto Wealth Report 2024 from Henley & Partners.
The report, which includes “exclusive stats on crypto and Bitcoin (BTC) millionaires, centi-millionaires, and billionaires from New World Wealth,” found that between July 1, 2023, and June 30, 2024, the number of crypto millionaires increased by 95%, while the number of Bitcoin millionaires surged 111% to 85,400.
“The total market value of crypto assets has now reached a staggering USD 2.3 trillion, an 89% increase when compared to the USD 1.2 trillion reported in the firm’s inaugural report last year,” the report said. “The upper echelons of crypto wealth have also expanded dramatically, with the number of crypto centi-millionaires (those with crypto holdings of USD 100 million or more) rising by 79% to 325, and even the rarefied cohort of crypto billionaires seeing a 27% increase to 28 globally.”
According to Dominic Volek, Group Head of Private Clients at Henley & Partners, the introduction of crypto exchange-traded funds (ETFs) in the U.S. drove the gains as they created an opening for “significant institutional capital” to enter the crypto market.
“The cryptocurrency landscape of 2024 bears little resemblance to its predecessors,” Volek said. “Bitcoin’s rise to over USD 73,000 in March set a new all-time high, while the long-awaited approval of spot Bitcoin and Ethereum ETFs in the USA unleashed a torrent of institutional capital.”
“Anticipation now builds for potential Solana ETFs joining the Wall Street party,” he added. “These milestones have seeded a new era of crypto adoption, one where digital assets increasingly cross-pollinate with traditional finance and global mobility.”
Henley & Partners also released The Henley Crypto Adoption Index 2024, which “evaluates investment migration programs through the lens of the crypto investor, considering factors such as public adoption, infrastructure, innovation and technology, regulatory environment, economic factors, and tax-friendliness,” the firm said.
“The index reveals a nuanced global picture,” said Volek. “Singapore leads the pack, with a #1 ranking across infrastructure adoption, innovation and technology, and regulatory environment. Hong Kong (SAR China) follows closely, buoyed by its robust economic factors and tax-friendly policies. The UAE rounds out the top three, offering unparalleled tax benefits and a burgeoning economy.”
Volek added that the Asia Pacific region is emerging as “a powerhouse for crypto-friendly investment migration,” as Singapore’s passage of a regulatory framework for stablecoins has positioned it “as a forward-thinking financial hub.”
For the Middle East, and the UAE in particular, he noted that the region continues to see an influx of crypto wealth due to its “zero capital gains tax and progressive regulations. Dubai's long history of crypto-friendliness, including the approval of the first cryptocurrency fund in the Middle East in 2021, further solidifies its position as a leading destination for crypto investors,” he said.
“More recently, Dubai's allowance for residents to trade cryptocurrencies directly with their bank accounts is indicative of a significant step towards mainstream adoption,” he added.
The top three jurisdictions for crypto adoption all have one thing in common: none of them levy capital gains tax, “which is a significant advantage, especially for crypto investors and high-net-worth individuals,” the report said.
“This year’s index underscores the increasing significance of investment migration programs in drawing crypto wealth,” they added. “European nations such as Cyprus and Malta feature progressive regulations and innovative approaches to digital assets. In the Caribbean, Antigua and Barbuda is emerging as an attractive destination, having enacted pioneering legislation to entice entrepreneurs in the digital asset space.”
And despite the ongoing regulatory crackdown on all things crypto in the U.S., Volek said the country remains an overall positive for the industry thanks to the “surge of interest following the approval of spot Bitcoin ETFs.
The one region that has been less-than-welcoming to crypto is India, Volek noted.
“India presents a more challenging environment for crypto investors,” he said. “The country's stringent crypto tax policies, including a 1% tax-deducted-at-source (TDS) on cryptocurrency transactions and a flat 30% tax on crypto gains, have driven many wealthy individuals to seek alternative residence and citizenship options. This growing interest underscores the desire of India's crypto-wealthy to find jurisdictions with more favorable conditions for optimizing their digital asset investments.”
Volek said that as the barrier between traditional and digital finance weakens, “the synergy between investment migration and cryptocurrencies grows stronger.”
“The crypto millionaires of 2024 are not content with digital riches alone; they seek the freedom of global mobility to match their borderless assets,” he said. “As nations compete to attract this new wave of digital wealth, we can expect investment migration programs to evolve, catering to the unique needs of the crypto elite.”
“In this digital gold rush, the most successful jurisdictions will be those that can offer a holistic ecosystem for crypto investors – combining favorable regulations, robust infrastructure, and pathways to alternative citizenship or residence,” he concluded. “As we move forward, the intersection of cryptocurrency and investment migration will undoubtedly play a major role in shaping the future of global wealth and mobility.”
