More than three-quarters of surveyed investors expect to increase their allocations to digital assets in 2025, with 59% planning to allocate over 5% of assets under management to digital assets or related products. Looking forward, surveyed investors noted regulatory clarity as the #1 catalyst for growth in digital assets.
With this as a backdrop, Coinbase and EY-Parthenon practice conducted a survey of more than 350 institutional investors across the world on their sentiment, investment plans and usage around digital assets. Conducted in January 2025, post-election, but prior to the digital asset executive order, the survey reflects an institutional investor base that is ready to build on an already strong foundation and prepared to both broaden participation and expand allocations as a global regulatory framework becomes clearer.
- Eighty-five percent of respondents increased allocations to digital assets and digital assets-related products in 2024, and a similar portion plan to continue doing so.
- In 2025, 59% of respondents plan to allocate over 5% of their assets under management (AUM) to cryptocurrencies, with US respondents and hedge funds indicating higher allocations than other segments.
- Concerns on regulatory clarity and volatility remain key issues for investors globally. In light of this, emerging regulatory clarity is recognized as the #1 catalyst for industry growth.
- Seventy-three percent of institutional investors currently hold one or more altcoins beyond BTC and ETH, led by hedge funds at 80%.
- Sixty percent of investors prefer to gain exposure to crypto through registered vehicles (e.g., ETPs1), with high levels of interest in further innovation including diversified index funds, altcoin ETPs, and USbased perpetual futures.
- The percentage of respondents that engage with DeFi is set to triple in the next two years, from 24% to 75%.
- Almost half of respondents leverage stablecoins, with key use cases focused on yield generation, transactional convenience in the markets, and foreign exchange.
- Fifty-seven percent of surveyed respondents are interested in investing in tokenized assets, particularly alternative funds, to drive portfolio diversification.
Three key themes to watch in 2025:
- Broader institutional participation: Investors are starting to embrace broader participation in crypto markets, including DeFi use cases such as staking, lending, and derivatives. While 24% of institutional investors currently engage in DeFi, this figure is set to triple to 74% in two years, according to survey respondents. There is also a growing appetite to invest in a broader set of assets beyond BTC and ETH with an increase in interest in other assets including XRP and SOL as spot investments or as part of potential new ETP offerings.
- Increased adoption of stablecoins and tokenized assets: There is an expected increase in the use of stablecoins as use cases continue to evolve. Nearly half of surveyed investors stated an interest in using stablecoins to generate yield, take advantage of transactional convenience or facilitate foreign exchange. Far from speculative, investors see stablecoins as the vehicle to deliver on digital assets’ promise to reduce transaction cost and provide instant settlement. Further, tokenization will provide investors greater access, with lower minimum capital commitments, to alternative investment vehicles including private equity, private credit and real estate.
- Regulatory clarity will bring new investments: Institutional investors see regulation as both their biggest risk and biggest opportunity in 2025. As such, more guidance around custody, tax treatment, usage of stablecoins, and permissibility of activities should spur new market participants and increased activity. So, much of the coming year will be a waiting game to see how new rules manifest across the globe.