Survey reveals growing confidence in digital assets
Attitudes from institutional investors towards cryptocurrencies are increasingly optimistic in 2025. That was the takeaway from a global survey of 352 decision-makers at various firms, conducted by Coinbase and EY-Parthenon in January.
The findings from the survey show that investors globally increased their allocations to digital assets this past year and intend to continue to do so throughout 2025. Building on the momentum from the growth of crypto exchanges for Bitcoin (BTC) and Ethereum (ETH) early in the year, 2024 was a year of growth for crypto.
Going forward, there is a positive outlook on the evolving regulatory environment cross the US, EU, and the globe. The underlying technology has also progressed in the past several years: Use cases have evolved, and transaction costs and speeds have become more compelling.
Most firms bullish on crypto
Respondents overwhelmingly reported their firms plan to increase their digital asset allocations in 2025. That increased bullish attitude is driven by expectations of higher returns compared to other asset classes.
Many investment firms are also instinctively driven to investing in innovation, with 49% saying their investment in crypto was aligned with a wide goal of investing in innovative technologies. 41% said they saw crypto investments as a hedge against inflation.
Prices expected to rise
Most investors agreed that in the next year cryptocurrency prices will likely rise. Almost 80% of respondents expect cryptocurrency prices to rise, and nearly 70% see crypto as the biggest opportunity to generate attractive risk-adjusted returns.
In addition, most investors (68% of those surveyed) said they saw cryptocurrencies as the best investment for generating attractive risk-adjusted returns over the next three years. That means they have more confidence in crypto than US and private equities and other categories like real estate.
Post-election attitudes
Most respondents expect increased investor interest and investment post-election, and they expect post-election regulatory clarity to be a major growth catalyst.
Of those surveyed, 60% said that they felt increased investor interest would be the main impact seen in the digital assets industry after the 2024 US election. This could because of the Trump administration’s early embrace of cryptocurrencies, with the announcement in March of a national Crypto Strategic Reserve kicking up some excitement.
Registered vehicle investments
A total of 60% of investors prefer exposure to crypto through registered vehicles in which crypto is the underlying asset. This could mark an increasing interest in altcoins, which are cryptocurrencies other than Bitcoin, often designed with unique features or specific use cases.
The growing investor preference for regulated crypto exposure, combined with rising interest in these alternative coins, creates a significant market opportunity. Consequently, the introduction of new spot Exchange Traded Products (ETPs) focused on altcoins could provide a regulated and accessible avenue for investors to diversify their cryptocurrency holdings beyond Bitcoin.
“Overall, we expect the positive tone and action from both the new US administration and regulatory bodies globally to accelerate an already expanding interest in digital assets,” the report notes.
The past year marked a significant turning point for digital assets, setting the stage for an even more pivotal 2025. Going forward, the digital asset and blockchain ecosystem is poised for substantial growth.
Overall, positive regulatory momentum is expected to fuel the already expanding interest in digital assets, fostering the continued development of these innovative ecosystems.
The wider crypto market took a massive hit in 2022 with the fall of crypto exchange FTX, which highlighted the risks associated with unregulated or poorly managed entities within the space, but ultimately paved the way for greater scrutiny and demand for more secure and transparent platforms.
