- The survey was carried out in January during the peak of Bitcoin’s historic high of $109,000.
- 59% of institutional investors plan to allocate more than 5% of their assets under management to digital assets.
- Additionally, 75% of respondents expressed intentions to invest in some form of tokenization by 2026.
Institutional investors continue to show optimism in the crypto market, with 83% planning to increase their cryptocurrency exposure by 2025.
The study, involving 352 institutional decision-makers, was conducted by Coinbase and EY-Parthenon.
The findings revealed that “over three-quarters of the investors surveyed anticipate boosting their allocations to digital assets by 2025, with 59% planning to invest over 5% of their assets under management into digital assets or related products.”
Conducted at the time of Bitcoin’s record high of $109,000, the survey indicated that nearly 80% of investors expect an increase in crypto prices, while around 70% view cryptocurrency as the most promising avenue for generating attractive risk-adjusted returns.
Growth in Stablecoins and DeFi
There is a growing interest in stablecoins, with 84% of institutions either currently utilizing or planning to utilize stablecoins this year. Furthermore, 75% intend to invest in some form of tokenization by 2026.
In terms of decentralized finance (DeFi), the proportion of investors expected to engage with it is projected to increase from 24% to 75% over the next two years. However, challenges remain, including regulatory (57%) and compliance (55%) issues, as well as a lack of internal expertise (51%), as highlighted in the survey.
Among those currently involved in or planning to engage with DeFi, the most sought-after use cases include derivatives (40%), staking (38%), and lending (34%).
The Need for Regulatory Clarity
Institutional investors perceive regulation as both the greatest opportunity and the biggest risk within the crypto market for 2025.
The survey suggests that establishing clearer regulations regarding custody, tax implications, and the use of stablecoins could attract new market participants and stimulate activity.
According to the researchers, “We anticipate that the positive stance and actions from both the new US administration and global regulatory bodies will further accelerate the growing interest in digital assets.”
Since the survey was completed, cryptocurrency prices have dipped. As of this publication, Bitcoin is trading at approximately $83,000, having previously fallen to $76,000 earlier this month following a statement from US President Donald Trump, who did not rule out a potential recession.
This post originally appeared on CoinJournal.
In January, during the peak of Bitcoin’s all-time high at $109,000, a survey conducted by Coinbase and EY-Parthenon among 352 institutional investors revealed significant optimism towards digital assets. The findings indicated a strong commitment to cryptocurrency investments, with 59% of respondents planning to allocate over 5% of their assets under management to digital assets. Furthermore, 75% of those surveyed expressed intentions to invest in tokenization by 2026.
The optimism among institutional investors is underscored by the finding that 83% plan to broaden their crypto exposure by 2025. In fact, more than three-quarters of the respondents expect their investments in digital assets to increase during that year, reflecting a palpable sense of opportunity in the crypto market. Remarkably, nearly 80% of investors anticipate a price rise in cryptocurrencies, while around 70% believe that crypto presents the most promising chance for generating attractive risk-adjusted returns.
Interest in stablecoins is on the rise, with 84% of institutions already engaged or planning to use stablecoins within the year. The survey also highlights the upcoming wave of investment in tokenization, with three-quarters of respondents planning to invest in such initiatives by 2026. Engagement with decentralized finance (DeFi) is expected to experience considerable growth, with the proportion of investors participating predicted to jump from 24% to 75% in the next two years. Nonetheless, the transition to DeFi is not without its challenges; 57% of respondents cited regulatory concerns, 55% pointed to compliance issues, and 51% mentioned a lack of internal knowledge as barriers to entry.
In terms of applications within the DeFi space, interest in derivatives, staking, and lending emerged as the primary use cases among firms actively engaging in or planning to participate in DeFi.
The survey also highlighted the dual nature of regulation as both a risk and an opportunity for the crypto market in 2025. Institutional investors believe that clearer regulations surrounding custody, tax treatment, and the use of stablecoins could facilitate the entry of new participants into the market and spur increased trading activity. The researchers expressed optimism regarding the influence of a favorable regulatory landscape, noting that proactive measures from current U.S. governance and other global regulatory bodies might bolster existing interest in digital assets.
Since the survey was executed, the cryptocurrency market has faced fluctuations, and as of the current publishing, Bitcoin’s value has decreased to around $83,000 after dropping as low as $76,000 earlier in the month, following concerns stemming from the possibility of a recession indicated by former President Donald Trump.
In summary, the outlook for crypto investments among institutional investors remains predominantly positive, with a majority planning to increase their allocations in the coming years. Interest in stablecoins and DeFi is also projected to grow, although regulatory hurdles and compliance concerns could pose challenges. Nevertheless, the general sentiment among institutional investors indicates a strong belief in the future potential of digital assets, positioning them as a central area of investment for the near future.
