Author: Bitwise
Compiled by: Jiahuan
Unlike most assets, crypto assets were initially driven by retail investors. Even today, it is estimated that retail investors still control more than two-thirds of the crypto market.¹ This means that institutional investors will still play an important role in the development of this asset class. Therefore, the degree to which institutional investors embrace crypto assets will have a significant impact on the prospects of this asset class.
However, institutions are usually unwilling to publicly discuss their views on crypto assets. Whether out of competitive considerations or fear of reputational damage, most institutions have historically avoided publicly disclosing their holdings.
This report hopes to break that silence.
Earlier this year, we had in-depth conversations with senior investment professionals at 15 large institutions around the world to learn about their views on crypto assets. We asked some direct questions: Which crypto assets do you buy? How much have you allocated? Why do you hold crypto assets?
Their candid answers surprised us. One of the findings was: although crypto asset prices drew down by more than 50% between October 2025 and April 2026, none of the institutions we interviewed planned to reduce their allocation to this asset class. Institutions are making long-term allocations.
Whether you are an institution looking to understand how peers view this space, or a retail investor hoping to gauge market sentiment, this report will open a window for you to understand how some of the world's most influential investors today view the crypto market.
Institutional money is entering the crypto space
Institutional investors are beginning to view crypto assets as an important part of their portfolios. The institutionalization of crypto assets is happening faster and more persistently than the public generally believes. Although many uncertainties remain in the market, we expect that within the next five years, most institutional investors will hold crypto assets.
After interviewing 15 senior asset allocation decision-makers from endowments, foundations, pensions, multi-family offices, sovereign wealth funds, and public companies, we found three consistent trends.
Bitcoin is a high-conviction asset broadly recognized by institutions, while Ethereum and Solana are not. All the institutions we interviewed that hold crypto assets hold Bitcoin. Most institutions view Bitcoin as a store of value and often explicitly compare it to gold. Ethereum, Solana, and other crypto assets are viewed by some institutions as early-stage technology investments, for which institutions set clear performance thresholds and adopt shorter holding periods. The crypto asset allocations of the interviewed institutions ranged from 0.5% to 13% of investable assets, with most between 1% and 2%.
Institutional crypto asset allocations are highly persistent. From October 2025 to April 2026, the crypto market fell about 50%, but none of the institutions we interviewed reduced their allocations during the market decline; several even increased them. When asked what would prompt them to exit, no one mentioned price. The reasons they considered exiting were related to investment logic: Ethereum and Solana failing to demonstrate practical use, a reversal in regulatory direction, or a credibility crisis across the entire industry. This runs counter to a common assumption: institutions are not the party most likely to sell when the crypto market declines; selling pressure comes from elsewhere.
The remaining obstacles to growth are governance and reputation, not investment value. Most institutions we spoke with recognize the value of including crypto assets in a diversified portfolio. What is currently slowing allocation progress is how to incorporate crypto assets into existing investment policy classifications, how to obtain approval through boards and committees, and how to manage the reputational risk brought by outside attention. As spot crypto ETFs increase, the regulatory environment improves, and more peers disclose their holdings, these obstacles are weakening, but they still cannot be ignored.
We believe that institutional demand is gradually accumulating outside public view. Some interviewed investors who have not yet allocated to crypto assets have already entered the late stages of due diligence. However, we expect this process to unfold gradually. For assets that remain controversial, it may take years for institutions to reach consensus; even when they do allocate, institutions often tend to keep a low profile. But the signs indicate that institutional money is entering the crypto space.
01 / Bitcoin is a high-conviction asset broadly recognized by institutions
All the institutions we interviewed that hold crypto assets hold Bitcoin. For almost all institutions, Bitcoin is the crypto asset they bought first, hold the most of, and have held the longest. It is the only crypto asset on which institutional investors broadly form a consensus.
Institutions have different reasons for investing in Bitcoin. Most institutions view Bitcoin as a store of value with significant potential upside, often placing it alongside gold as a hedge against the declining purchasing power of fiat currencies. One endowment fund described its Bitcoin position as an investment in a "store of value transitioning from emerging to mature," as well as a venture capital-like bet: that over the next 5 to 15 years, the Bitcoin market will grow to $20 trillion.
A few institutions allocate to a basket of mainstream crypto assets weighted by market capitalization, so Bitcoin accounts for roughly 80% of their crypto holdings. However, most institutions hold Bitcoin as a standalone position.
Even institutions that cannot directly hold Bitcoin recognize its role in diversifying risk within a portfolio. One large endowment fund's policy prohibits it from holding any physical commodities, including Bitcoin, but it still views Bitcoin as the digital counterpart to gold and the core asset of the entire crypto asset class.
02 / Ethereum and Solana Are Bets That Depend on the Investment Thesis
Bitcoin has become a consensus among institutional investors, but Ethereum, Solana, and other smaller-cap crypto assets have not. Institutions holding these assets have smaller allocations, shorter investment horizons, and clear exit conditions.
Several institutions hold no Ethereum or Solana at all, for different reasons. One institution had heavily used DeFi applications, involving lending, trading, stablecoins, and staking, but did not see how the underlying tokens accrue value. In their view, users do not care about the differences between blockchains, nor whether an application runs on Ethereum or Solana. Another institution found it difficult to fit Ethereum or Solana into its existing investment framework: are they stores of value, equity-like assets, or commodities? Without a clear value accrual logic, or the ability to match an existing investment framework, the default choice is not to invest.
Institutions that hold Ethereum and Solana view them as early-stage technology investments. Several institutions explicitly stated that if substantial adoption growth does not materialize in the coming years, they will sell.
Among institutions holding both assets, preferences are beginning to diverge. One endowment fund prefers Solana's architecture, citing its high throughput, low latency, and lack of reliance on Rollups. Another holds Ethereum rather than Solana, focusing on Ethereum's actual adoption and its dominant market share in real-world crypto applications, including DeFi, prediction markets, tokenization, and stablecoins.
Notably, in almost all cases, institutions view these assets as driven by actual utility; their value comes from real-world practical applications. Some crypto industry participants have tried to position Ethereum, especially Ethereum, as a competitor to Bitcoin for monetary use, but the institutional community does not share this view. In their view, these assets only have investment value if value can clearly accrue to the underlying tokens of Ethereum and Solana as transaction activity and fees increase.
03 / Allocations Are Small, but the Overall Direction Is to Increase
Crypto asset allocations range from 0.5% to 13% of investable assets, with most between 1% and 2%, typically allocated across channels such as ETFs, direct holdings, venture capital, and hedge funds. The common approach is: an allocation large enough to impact the portfolio if the crypto investment thesis plays out, but not so large that it drags down the entire portfolio.
During the market volatility from late 2025 to early 2026, institutions maintained their existing allocations or continued progressing toward established targets. Many institutions are shifting funds from less liquid private investment vehicles to direct holdings or ETF exposure. Several institutions have also added market-neutral strategies to reduce the volatility brought by crypto assets and make allocations easier to approve. One asset allocation decision-maker sees this as the way to get institutions off the sidelines: "The easier way to sell it is to start with a market-neutral strategy. You're not really betting on crypto, you're just betting on arbitrage."
The focus of internal discussions at these institutions is no longer whether to allocate to crypto assets, but how much to allocate, through what vehicles, and which assets to allocate to.
04 / Spot ETFs Have Changed How Institutions Enter the Crypto Market
Spot crypto ETFs have changed how institutions enter this asset class. Nearly all the institutions we interviewed are already using, or plan to use, such ETFs.
Institutions shifting from direct custody to ETFs cited lower total costs, a lighter operational burden, and a simple fact: from a back-office perspective, ETFs make crypto assets look just like any other ordinary holding. For early allocators, who had spent years dealing with crypto asset custody, trade execution, and position reporting, this point about ETFs is more important than many people imagine.
Institutions that have not yet shifted to ETFs are mostly constrained by private investment vehicles and cannot freely choose their exit timing. These institutions are actively evaluating ETFs, considering not only the same operational advantages, but also the rebalancing flexibility and liquidity that closed-end products cannot provide.
However, a small number of institutions intentionally do not use ETFs. One sovereign wealth fund is building local custody infrastructure to meet the government's requirement for direct control over the underlying crypto assets. A large public endowment's policy prohibits it from holding any physical commodities, including through ETFs. Another institution mentioned that ETF holdings may need to be disclosed through 13F filings, which would bring public exposure they wish to avoid.
This also affects estimates of institutional holdings. Because some institutions intentionally invest in vehicles that avoid 13F disclosure, institutional crypto asset holdings estimated based on 13F filings should be regarded as a minimum estimate, not an upper limit.
05 / The combination of gold and Bitcoin has become an important allocation framework for institutions
For most of the institutions we interviewed, Bitcoin and gold are now often considered together. Especially for institutions worried about the declining purchasing power of fiat currency, Bitcoin is an important part of the portfolio. One large endowment said: "People are starting to put Bitcoin and gold together as an investment to hedge against fiat currency depreciation."
Several endowments intentionally establish Bitcoin and gold positions simultaneously as a portfolio construction choice. In one notable case, a sovereign wealth fund funded part of its crypto asset allocation by selling foreign exchange and gold reserves.
For some institutions, Bitcoin and gold increasingly seem like two expressions of the same investment view, rather than merely complementary assets. One institution places Bitcoin in the "gold category" and stated its long-term view bluntly: "When we talk about this again in ten years, we may tell you that we have abandoned gold and now switched entirely to Bitcoin."
However, not all institutions hold this view. One foundation completely rejects the "digital gold" narrative and classifies all crypto assets as disruptive technology rather than a store of value.
06 / Allocation obstacles come from operations and reputation, not investment analysis
Among the institutions we interviewed, judging whether crypto assets are investment-attractive is usually the easiest hurdle to clear. The past performance and development trajectory of crypto assets are already quite clear, and the view of crypto assets as a disruptive technology is widely accepted. People believe it will change multiple areas, from capital markets and global payments to the store-of-value market.
What really slows down allocation progress are operational, reputational, and classification issues: how to custody assets, how to publicly explain the investment rationale, and how to incorporate crypto assets into portfolios based on stocks, bonds, and alternative assets. However, over time, these obstacles are gradually weakening, just as has happened with all emerging asset classes.
The most practical advice we heard came from a multi-family office: "Just establish a process." In other words, apply the same evaluation framework to crypto assets as to other assets. Even if they consider this type of asset "astonishingly volatile," do not set a higher investment threshold specifically for crypto assets.
Decision-making frameworks vary greatly across institutions. At one end are institutions without a formal approval process, where the investment team decides on an allocation and executes it directly. At the other end, a sovereign wealth fund's crypto program is directly reviewed by senior officials at the country's central bank, including background checks on the chief investment officer, security reviews, public opinion risk, and peer recognition. These factors receive more attention than the fundamental basis of the investment itself.
Another difficulty is how to classify crypto assets. Several institutions struggled to categorize Ethereum and Solana, and several decided not to invest solely because of this ambiguity. Two endowments solved this problem in different ways: one added a "liquid venture capital" category to its venture portfolio; the other bypassed the debate and classified all crypto assets as venture capital.
07 / Career risk is an important factor influencing institutional behavior
Career risk, that is, the career cost that a failed allocation may impose on investment professionals, affects every public-facing institution we interviewed. It is often one of the most important factors determining whether to allocate and how to allocate. Foundations, public pensions, and sovereign wealth funds all listed it as a consideration. Smaller, lower-profile, or founder-led institutions feel less pressure, but the pressure still exists.
It is worth noting that we found institutional allocations often occur in clusters. Once a certain number of peers have completed and disclosed allocations, the risk shifts from "I allocated and something went wrong" to "everyone else allocated and I missed out." Our interviews suggest that the endowment sector may be approaching this turning point. Several large university endowments have publicly disclosed crypto asset holdings, and several endowments also told us that they now ask peers more directly about crypto asset allocations than in the past. One even explicitly stated that comparison with peers is one of the main drivers of its crypto asset allocation.
However, this also brings a risk: if the market remains depressed for a long time, the wind may shift again, and at that point the reputational risk of allocating to crypto assets may exceed the risk of not allocating.
08 / Institutional-facing crypto fund managers are highly concentrated
There are not many crypto fund managers that meet institutional investment requirements. One sovereign wealth fund said: "It is very difficult to find managers that meet our minimum requirements for scale, proven track record, and operational infrastructure. We have found about ten names." When it exchanged information with other institutions, the list hardly changed: "Different institutions are at different stages of due diligence, but everyone is looking at the same group of managers." Other institutions we interviewed confirmed this as well.
This convergence is reassuring to some extent, showing that after rigorous review, institutional investors have reached similar conclusions about which managers can meet the standard. But it also creates concentration risk. As more institutions complete due diligence and begin investing, a considerable portion of capital will flow to a small number of companies. If any one of them has a compliance failure or operational breakdown, the entire institutional group could be affected. Some investors worry about the consequences. One endowment said: "Funds raising too much and being forced to invest, while there are not enough good opportunities in the market, is a risk."
This concentration also has a reverse effect. Managers are eager to obtain funding from sovereign wealth funds and endowments, so large investors have significant bargaining power. Some institutions are using this to seek cooperation models beyond ordinary fund investments. One sovereign wealth fund is considering directly holding equity in management companies in order to "gain full transparency, understand their investment strategies, and better understand the market."
09 / Exit conditions depend on investment logic, not price
From October 2025 to April 2026, the crypto market fell by about 50%. None of the institutions we interviewed reduced their crypto asset allocations during this period, and several increased them. When asked what would prompt them to exit, no one mentioned falling prices.
Instead, the exit conditions they proposed were all related to investment logic. Several institutions said that if in the coming years they find that real-world adoption growth does not lead to asset price increases, they would exit Ethereum and Solana. One institution that has held crypto assets for ten years said bluntly: "Something has to actually work. If at some point these things still do not work, we will leave." Institutions that only hold Bitcoin said that if some clear application emerges on Ethereum or Solana and materially changes the flow of value, they would reconsider their allocation. Sovereign wealth funds listed a reversal in regulatory direction or a major credibility crisis in the industry as reasons to consider exiting.
Some of these institutions already hold positions and have experienced multiple market drawdowns of more than 50%, including the decline in 2022. They are not surprised by volatility, nor are they deterred by it.
One investment advisor said: "If the investment logic is correct, given that adoption is growing along an S-curve, selling now is simply selling too early."
This means that when the crypto market falls, the main sellers are not institutional investors, but retail investors, holders forced to sell, or traders executing short-term strategies, such as unwinding basis trades or liquidating margin positions. Institutional investors are often on the other side of these trades.
10 / Sovereign wealth fund crypto allocations are gradually taking shape
Several sovereign wealth funds we interviewed are actively evaluating sizable crypto asset allocations. Several have already completed allocations, while others are still in the early research stage. Regardless of the stage, we found that their attitude toward crypto assets is generally positive. However, compared with smaller crypto investors, sovereign wealth funds are slower to advance allocations.
One sovereign wealth fund explained that even if the president supports it and the political leadership has reached agreement, the legal and regulatory infrastructure needed to direct sovereign capital into crypto assets still takes more than a year to build. Other sovereign wealth funds have also publicly mentioned that related plans will be advanced over several years.
It is also worth noting that sovereign wealth funds' reasons for allocating to crypto assets sometimes go beyond the impact on the portfolio itself. Several sovereign investors view crypto investment as a means to attract foreign capital, support national crypto industry plans, or promote their country as a hub for this high-growth industry. This approach has a practical implication: even if investment returns are poor, as long as advancing these ancillary goals still has value, institutions may continue to hold related positions. Therefore, sovereign wealth fund crypto allocations may be more persistent than the market expects.
Looking ahead
Behind all our interviews is a fundamental question: will institutional adoption of crypto assets accelerate or slow down? Overall, the interview results present a positive picture. But we gradually found that whether institutional adoption grows or stagnates will depend on four key factors, two of which may provide momentum and two of which may create obstacles.
The first major positive factor is regulatory clarity. Several interviewees said that the approval of spot crypto ETFs and the current U.S. administration's regulatory stance in support of the crypto industry were drivers of their recent allocation increases. Further regulatory progress, including approval of more products, legislation supporting the crypto industry, and adoption of crypto assets at the sovereign level by other countries, will lower operational, reputational, and regulatory barriers and drive more investment.
The second positive factor is the growing participation of peers, which typically creates a flywheel effect: the more credible institutions publicly allocate, the lower the reputational cost of investing in crypto assets, and the more likely other institutions are to publicly allocate as well. Our research shows that this dynamic is already at work, and each additional allocating institution may lower the threshold for multiple institutions to enter the market. The same force can also work in reverse. Therefore, we believe that institutional adoption trends, whether improving or weakening, are more likely to change exponentially rather than linearly.
As for the unfavorable factors, the most significant downside risk is a major crisis in the crypto industry, including technical failures or the collapse of important industry institutions. In the past, severe crises have stalled institutional adoption for years. Similar events would likely reshape institutions' considerations of career risk and prevent new allocations for an extended period. Strengthened regulation, as well as substantive progress in custody, security, and infrastructure, have already greatly reduced this "blow-up" risk, but have not eliminated it entirely.
The second layer of risk is that Ethereum, Solana, and crypto applications fail to prove that they have significant utility at scale. For institutions holding these assets, it is not enough that people use crypto applications such as stablecoins, DeFi, tokenization, and prediction markets; if these activities fail to bring value to the underlying tokens, the investment thesis cannot be justified. In other words, growing adoption is not enough; prices must also keep up. Several institutions have set clear deadlines for this, usually within the next few years, and will observe whether stablecoin transaction volumes, DeFi and tokenization activity, and fees actually accrue to the underlying tokens of Ethereum and Solana, rather than flowing to competitors or other layers in the technology stack. If substantive adoption does not emerge, or if adoption growth fails to drive token value, institutional portfolios may ultimately retain only Bitcoin.
How Different Types of Institutional Investors Now View Crypto Assets
Throughout the interview process, one interesting phenomenon impressed us: various types of institutional investors generally believe that adding crypto assets to a portfolio may be reasonable, but they differ in the specific allocation arrangements, including who approves, who oversees, and where crypto assets should be placed in the portfolio.
01 / Endowments and Foundations
Assets under management: $500 million to $75 billion
Crypto asset allocation: 0.5% to 10% (most 0.5% to 2%; one once reached 10%)
Investment vehicles used: venture capital, spot ETFs, direct custody, hedge funds
Endowments and foundations are pioneers in institutional adoption of crypto assets, and many institutions say they have already made sizable investments. This is because, compared with other institutions, they typically face lighter governance requirements. According to our interviews, in most cases, whether to allocate mainly depends on the judgment of the chief investment officer and a small team, without the need for a lengthy approval process by a large committee.
A prominent characteristic of this group is intense competition among institutions. Because endowments and foundations compare performance with one another, their crypto asset allocations may contain a game-theoretic element: how much crypto do competitors hold? If one's own allocation ratio is lower or higher than peers, what impact will that have on relative performance? A senior investment professional at a large U.S. endowment put it bluntly: "If peers hold crypto assets and you do not, then relative to the benchmark against which you are evaluated, you are effectively structurally short."
Therefore, the allocation behavior of this group may drive one another: each allocation disclosure may trigger a chain reaction, prompting peers to follow suit or benchmark against competitors' practices.
One foundation differs from other institutions, with crypto asset holdings sometimes exceeding 10% of its portfolio. It cares less about what peers do and instead views crypto assets as a bet on growth and disruptive technology. This approach supports a larger allocation and is consistent with its mission-oriented investment strategy, namely to "actively embrace the disruptive technologies we believe can transform endowments and ultimately benefit beneficiaries over the long term."
02 / Sovereign Wealth Funds
Assets under management: $1 billion to $100 billion
Crypto asset allocation: 1.0% to 1.5%
Investment vehicles used: hedge funds (directional and market-neutral), venture capital, direct custody, spot ETFs, and index funds
Sovereign wealth funds are at the other end of the governance spectrum. One sovereign wealth fund we spoke with had its crypto asset allocation subject to review by the country's central bank leadership. The main issues centered on external perception, such as what the investment would look like once made public, and whether other sovereign wealth funds and central banks had already moved first.
One sovereign wealth fund described its approach by saying they first had to convince the investment committee and the board, then start small, and only expand the allocation after external perception and the regulatory environment improved. Part of the resistance came from concerns about risk itself. Many members with traditional finance backgrounds said that the volatility of crypto assets "really put them off," because even less volatile crypto assets have relatively high annualized volatility. Another sovereign wealth fund recalled that even a simple relative value strategy was subject to direct central bank scrutiny: "Frankly, pitching our first crypto investment was really hard."
At the same time, several sovereign wealth funds noted that their purpose in allocating to crypto assets was not only to pursue returns. Holding crypto assets could also represent national strategy, signal that the country intends to become a hub for this industry, and align with an overall plan to build crypto infrastructure and improve regulation. One sovereign wealth fund described its allocation as a multi-year bet aimed at gaining global recognition rather than pursuing short-term returns.
This dual objective gives sovereign capital unusual persistence. Once an allocation is made, even if investment returns are unsatisfactory, the strategic rationale may still support the institution in continuing to hold.
03 / Public Pensions
Assets under management: $1 billion to $10 billion
Crypto asset allocation: 1.5% to 4.5%
Investment vehicles used: Venture capital and hedge funds
Public pensions' adoption of crypto assets varies. The main reason is that public pensions are accountable not only to their boards but also face oversight from elected officials, beneficiaries, retirees, and local media, exposing them to more scrutiny than any other type of institution. Put plainly, pensions are reluctant to allocate to crypto assets not because crypto assets lack investment value, but because of external pressure. A representative of one public pension told us that some people "would rather have much more mediocre performance, as long as we don't show up in the news." In other words, the only thing worse than losing money is making money from crypto assets.
The pressure from public reaction was strong enough to prompt some pensions to adjust their practices. One team said they "decided to stop giving media interviews because crypto assets are highly controversial among the public." The same team said public scrutiny "did not change their allocation," and noted: "The trustees' resolve was very firm; they understood the investment logic and kept the faith; despite all kinds of opposing voices, they still adhered to their original allocation and investment logic."
Even so, pensions do hold crypto assets. One pension we spoke with said they "included crypto assets in a broader innovation investment allocation, which also includes artificial intelligence, life sciences, space, and other innovative technologies." Most pensions initially targeted a crypto asset allocation of 1% to 2% of the portfolio, but some institutions saw the allocation approach 7% at one point because of strong asset performance. At the time of our interviews, the pensions surveyed held positions of 5% or less.
Clearly, concerns about public pressure affect whether pensions allocate to crypto assets and how they do so. Pensions that decide to allocate prefer non-public investment vehicles such as venture capital and hedge funds, because these can be quietly folded into existing alternative asset categories, unlike ETF holdings that may require public disclosure and are less likely to attract attention.
04 / Multi-Family Offices and Investment Advisors
Assets under management: $1 billion to $50 billion
Crypto asset allocation: 0% for nonprofit organizations; up to 13% for family offices (target allocation of 5%)
Investment vehicles used: Venture capital, spot ETFs, and index funds
Multi-family offices and investment advisors (some of which also advise nonprofit organizations) hold sharply different views on crypto assets depending on the type of client. When advising family clients, they tend to allocate firmly and evaluate crypto assets using the same fundamental and quantitative frameworks used to assess stocks or gold. When advising nonprofit organizations, they are usually much more cautious.
This ultimately comes down to different levels of decision-making. Family offices often only need to answer to a single principal and may be able to make a decision within a day; nonprofit institutions, by contrast, are usually managed by long-serving committees that rely on consensus decision-making, and committee members often tend to follow peer benchmarks.
One interviewee summed up the resistance they often encounter on nonprofit investment committees: “They ask, what kind of rat poison is this? Didn’t Warren Buffett say it would go to zero?” He then offered a blunt assessment of the future trend: “Our nonprofit clients won’t allocate because of how it looks on a chart. They’ll allocate because the next generation enters the committee.”
This lesson applies to our entire study: where one person can make the decision, crypto assets get allocated; where a committee must reach consensus, decisions often stall. For family offices, career risk and public perception are usually not key factors, while these factors can hold back public-facing institutions. This is also why family offices often act first.
One investment advisor summarized the difference between these two types of institutions: “Our family clients really are ahead. They take the time to understand crypto assets, they don’t need an investment committee, and they don’t have those public-image risks that can hold them back.”
05 / Public Companies
Assets under management: Not applicable
Crypto asset allocation: 1% to 10% of excess cash
Investment vehicles used: Spot ETFs and direct custody
Public companies cover a very broad range. At one end are digital asset treasury companies (DATs), whose purpose is to raise funds to buy crypto assets; at the other end are crypto-native companies such as miners and exchanges, which hold crypto assets because their businesses require it. In between, more and more ordinary companies are beginning to use crypto assets as a strategic reserve, usually accounting for 1% to 10% of excess cash.
The most noteworthy change in this group is that in recent years, the resistance companies face in holding crypto assets on their balance sheets has fallen sharply. A company’s CFO told us that, based on their experience, disclosing crypto asset holdings in regulatory filings or on earnings calls has “stopped being a big deal.” The CFO’s conclusion reflects how much the threshold has changed: “It already feels like a very ordinary investment a company can make.”
Conclusion
We opened the report with a question: How do institutional investors view crypto assets? After dozens of hours speaking with these decision-makers, some of whom are among the world’s most sophisticated and influential investors, we can conclude that this is no longer the most worthwhile question to ask. Most of the institutions we interviewed are no longer debating whether crypto assets should enter portfolios, but rather how much to allocate, in what form, on what timeline, and subject to which governance constraints. The discussion has shifted from “whether” to “how.”
This shift is the real finding of this report, and it matters more than any single allocation figure. Investment conviction is built slowly and changes slowly. Implementation of allocations depends on processes, infrastructure, and resolve, and all three are improving. Constraints may gradually loosen, but investment conviction will not change in the same way. Most of the remaining obstacles are not doubts about the asset itself, but reputational, operational, and timing issues. We expect that, over time, these obstacles will fade.
One important finding of ours is that institutional adoption has a self-reinforcing effect: each allocation by a credible institution lowers the cost for the next institution to enter the market; one disclosure leads to more disclosures. Therefore, we believe the future path is more likely to be exponential than linear. Institutions that appear to be lagging today are usually not skeptics who reject crypto assets on principle. They are simply cautious professionals waiting for more support and data, and those conditions are gradually arriving.
Of course, the risks are still real. A severe crypto industry crisis could restart the process, and persistently low returns or poor real-world adoption could also weaken market interest or hinder the due diligence currently underway.
But the direction of future development is not ambiguous. The institutions we spoke with painted a clear picture: institutional money is flowing into crypto in a planned, long-term way. The process of institutional adoption of crypto assets is earlier than public data suggests and more persistent than the market believes. Following this trend, we expect that within the next five years, most institutional investors will hold crypto assets.
