The study, which surveyed pension funds, insurers, family offices, wealth managers and hedge funds across multiple countries, including the US and the UK, found strong expectations for increased institutional adoption of cryptocurrency.
More than two-thirds (66 per cent) of respondents ranked cryptocurrency among the top five asset classes for risk-adjusted returns over the next five years, just ahead of private equity (64 per cent) and emerging market equities (61 per cent).
Meanwhile, 73 per cent of institutional investors and wealth managers expect more cryptocurrency fund launches during the remainder of 2025. Overall, 43 per cent believe traditional financial firms will sharply increase the creation of cryptocurrency-focused funds and investment products over the next two years.
The research also showed that when it comes to access to digital assets, companies prefer to utilise actively managed diversified long-only portfolios, followed by actively managed diversified long-short portfolios with passive diversified portfolios the third choice.
Arbitrage-focused hedge funds were ranked fourth ahead of exchange-traded funds and exchange-traded products.
Commenting on the findings, Anatoly Crachilov, CEO and founding partner at Nickel Digital, highlighted that traditional finance firms are already making significant strides into the digital assets space.
“The views of institutional investors and wealth managers on the ability of crypto to deliver attractive risk-adjusted returns helps to explain why that is the case, and why professional investors increasingly expect crypto to be part of institutional investors’ portfolio allocation,” Crachilov said.
The report’s release coincided with a strong week for cryptocurrency markets, which saw bitcoin (BTC) shatter its previous record of around US$112,000 to rise to US$116,868 by Friday morning (AEDT).
Charlie Sherry, head of finance at BTC Markets, attributed the rally to, among other things, increased institutional interest.
“Global BTC spot trading volumes surged 23.6 per cent … topping US$51.7 billion in 24-hour turnover,” Sherry added.
“On the local BTC Markets exchange, we’ve seen an 18.4 per cent lift in AUD-denominated BTC volume day-on-day, with BTC/AUD now accounting for the majority share of local crypto trading activity.”
According to Zerocap associate Emir Ibrahim, bitcoin is “increasingly” behaving like a fiat debasement hedge – decoupling and outperforming on days when the S&P 500 corrects.
He attributed the latest sharp price action to a “short squeeze that had been building over several weeks, driven by derivative shorts and spot exchange outflows”.
“For this rally to extend, spot buyer dominance needs to stick, which looks constructive right now with so many bitcoin treasuries launching,” he said.
Looking forward, Sherry said: “From a technical perspective, the immediate support is now at the previous breakout level of US$113,000, with resistance sitting at US$120,000, followed by US$128,500, a key Fibonacci extension level based on the last macro swing.”
He highlighted that while bitcoin leads from the front, attention is beginning to shift towards the broader market, with Ethereum gaining 7.23 per cent on the day, testing key resistance at US$3,000, and Solana reclaiming US$164. Combined, Sherry said, these movements suggest risk appetite is broadening.
InvestorDaily on Thursday explored why bitcoin’s latest rally may be forcing a rethink of what it means to hedge, with Ryan McMillin, co-founder and chief investment officer of Merkle Tree Capital, declaring the 60/40 portfolio “dead” in favour of a 60/20/20 model with exposure to bitcoin. To read more, click here.
