State Street finds institutional investors eye doubling their digital asset exposure within three years
Quick Take Nearly 60% of institutional investors plan to increase their digital asset allocations in the coming year, and average exposure is expected to double within three years, State Street’s 2025 Digital Assets Outlook shows. More than half of investors expect up to a quarter of their portfolios to be tokenized by 2030, led by private market assets, the firm said.
Institutional investors are accelerating their shift toward blockchain and tokenization technology, with the majority expecting average exposure to digital assets to double within three years, according to a new research study from global custody and asset-management giant State Street.
The report also shows that nearly 60% of institutions plan to increase their digital asset allocations in the coming year, reflecting growing confidence that blockchain-based assets are becoming a permanent part of long-term investment strategies.
The findings come from the bank's 2025 Digital Assets Outlook, which surveyed senior executives across global asset managers and owners to assess sentiment, strategy, and operational readiness regarding emerging technologies.
Founded in 1792 and headquartered in Boston, State Street ranks among the world’s leading financial institutions. It oversees approximately $49 trillion in assets under custody and administration and about $5.1 trillion in assets under management through its investment arm as of June 30, 2025.
The firm is especially known for its SPDR ETF family, including the iconic SPY, and operates primarily in three core segments: asset servicing and custody, investment management, and data/analytics solutions for institutional clients.
Doubling down on tokenization
Over half of respondents anticipate that between 10% and 24% of institutional investments will be tokenized by 2030, highlighting the scale of change expected across global capital markets.
Private markets are seen as the first frontier for tokenization, according to the study, particularly in private equity and private fixed income. State Street said institutions are focusing on these traditionally illiquid asset classes to unlock new liquidity and operational efficiency.
Investors cited transparency (52%), faster trading (39%), and lower compliance costs (32%) as the main benefits driving digital assets adoption, with nearly half predicting cost savings exceeding 40% as a result.
The research also shows that 40% of institutional investors now have dedicated digital asset units, and nearly one in three view blockchain operations as integral to their broader digital transformation efforts.
"We're seeing clients rewire their operating models around digital assets," State Street's Chief Product Officer Donna Milrod said in a statement shared with The Block. "From tokenized bonds and equities to stablecoins and tokenized cash, the shift isn't just technical — it's strategic."
Beyond blockchain, over half of respondents said generative AI and quantum computing will ultimately be "more impactful" on investment operations than tokenization itself, but most see these technologies as complementary to digital asset programs.
"The acceleration in adoption of emerging technologies is remarkable. Institutional investors are moving beyond experimentation, and digital assets are now a strategic lever for growth, efficiency, and innovation," State Street President of Investment Services Joerg Ambrosius said. "As tokenization, AI, and quantum computing converge, early adopters are leading the way in shaping the future of finance."
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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