Institutional Investors Cite Regulatory Clarity as Key to Crypto Growth

A majority of institutional investors believe clearer regulations will be the biggest catalyst for the expansion of the digital asset industry, according to a new survey conducted by Coinbase (COIN) and EY-Parthenon (EYP).

The survey, conducted between Jan. 13 and Jan. 24, 2025, gathered insights from 352 institutional investors, revealing that 86% already have or plan to gain exposure to crypto this year. Additionally, 84% increased their digital asset allocations in 2024.

59% of respondents indicated they intend to allocate over 5% of their assets under management (AUM) to cryptocurrencies in 2025. Investors also pointed to a shifting regulatory environment under President Donald Trump’s administration as a key tailwind for the sector, given the President’s pledge to position the U.S. as the “crypto capital of the world.”

The study also highlighted growing interest in altcoins, with 73% of investors holding assets beyond bitcoin (BTC) and ether (ETH). Hedge funds led this trend, with 80% reporting exposure to alternative digital assets.

Furthermore, half of the surveyed investors said they use stablecoins for purposes like yield generation, payments, and foreign exchange transactions. Meanwhile, 60% of respondents expressed a preference for accessing crypto markets through regulated investment products like exchange-traded products (ETPs).

The survey primarily focused on institutional investors from the U.S. and Europe, with additional insights from participants worldwide.