Increasing Institutional Investment in Crypto

In 2025, 83% of institutional investors plan to increase their allocation of funds to crypto holdings, according to a report by Coinbase and EY-Parthenon.

The report, published on Mar. 18 on Coinbase’s blog, gathered insights from decision-makers in 352 companies. It revealed a growing belief that cryptocurrency will continue to yield strong returns.

59% of those surveyed plan to allocate at least 5% of their assets under management to digital assets this year. This shift signals that crypto is evolving beyond its niche reputation and becoming a core part of institutional portfolios.

84% of investors are either using or considering the use of stablecoins, which have gained substantial traction over the past year. While stablecoins have historically facilitated cryptocurrency transactions, they are now being explored for yield generation, foreign exchange, cash management, and various payment systems.

Institutional interest in decentralized finance (DeFi) is also increasing. Although only 24% of surveyed investors currently engage with DeFi, that figure is expected to soar to 75% within two years. Many businesses see DeFi as an opportunity to access lending, derivatives, and staking markets.

73% of respondents own assets other than Bitcoin (BTC) and Ethereum (ETH), signifying high interest in altcoins. Ripple (XRP) and Solana (SOL) are the most commonly held, with many investors considering single-asset exchange-traded products for altcoins.

Despite the optimism, challenges persist. Investors’ top concerns include regulatory uncertainty (52%), market volatility (47%), and secure custody (33%). 68% of respondents believe that more transparent regulations could expand the market.

In a related advance, on Mar. 17, Securitize and Ethena Labs launched Converge, a blockchain designed to promote institutional adoption of tokenized assets. Supported by companies like Aave Labs, Pendle, and Maple Finance, the Ethereum-compatible network aims to bridge DeFi with traditional finance by providing a regulated environment for tokenized assets.

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