Bitcoin News Today: Tokenization Drives Tripling of Institutional Digital Holdings by 2028

Wall Street is preparing for a significant shift in digital asset investments, with institutional investors poised to double their exposure to Bitcoin and other cryptocurrencies by 2028, according to recent research. A 2025 Digital Assets Outlook from State Street, a custodian managing $49 trillion in assets, reveals that over half of surveyed institutions anticipate tripling their digital asset holdings within three years. The firm's analysis highlights tokenization of private equity and fixed income as the primary entry points for this expansion, enabling traditionally illiquid assets to be fractionalized and traded on blockchain networks. By 2030, a majority of respondents expect 10% to 24% of their portfolios to be tokenized, a move that could streamline trading, reduce compliance costs, and enhance transparency.

The push toward tokenization is driven by operational efficiency and cost reduction. Nearly 50% of institutions surveyed reported potential savings of at least 40% from adopting digital asset infrastructure, with improved visibility into asset data cited as a key advantage. State Street's Chief Product Officer, Donna Milrod, emphasized that the shift is not merely technical but strategic, as firms restructure operations to integrate blockchain-based tools. This aligns with broader industry trends, including the launch of tokenized funds by major players like BlackRock and Franklin Templeton, as well as private equity firms such as Hamilton Lane exploring tokenized offerings to expand retail access to previously exclusive asset classes.

Existing institutional participation in crypto markets is already substantial. ETFs hold over $188 billion in Bitcoin, while public and private companies collectively hold $169 billion in BTC. The Coinbase and EY-Parthenon 2025 Institutional Digital Assets Survey further underscores this momentum, noting that 75% of global institutional investors plan to increase allocations to digital assets this year, with 59% targeting over 5% of assets under management. Stablecoins and tokenized assets are gaining traction, with 84% of institutions either using or expressing interest in stablecoins for yield generation and cross-border transactions.

Emerging technologies are accelerating adoption. Generative AI and quantum computing are viewed by many institutions as complementary tools to optimize investment operations, while regulatory clarity-such as the U.S. GENIUS Act-has removed a major barrier to large-scale participation. JPMorgan analysts noted that regulatory progress and recent developments like Bullish's IPO have reignited institutional interest, with Ether and Solana positioned as key beneficiaries of this trend. The bank also highlighted Bullish (BLSH) as an equity proxy for crypto adoption, with shares up 45% post-IPO.

Challenges remain, however. Interoperability between blockchain networks and legacy systems, unclear legal frameworks, and liquidity concerns in secondary markets are hurdles to widespread adoption. Despite these, financial institutions and regulators are working toward standardized frameworks to support tokenized markets. PwC's analysis of tokenization in financial services underscores its potential to reduce settlement times, automate compliance, and unlock new revenue streams, particularly in cross-border transactions and collateral management.

As institutions move beyond experimentation to strategic integration, the role of digital assets in traditional finance is set to grow. With tokenization enabling faster, cheaper, and more transparent transactions, the financial sector is poised for a structural transformation. The coming years will likely see institutional adoption outpace retail enthusiasm, reshaping capital markets and redefining liquidity in an increasingly digital economy.

Source: [1] State Street 2025 Digital Assets Outlook (https://www.coindesk.com/business/2025/10/09/institutional-investors-expect-tokenization-to-double-digital-asset-exposure-by-2028-state-street-says) [2] TheCryptoBasic 2025 Report (https://thecryptobasic.com/2025/10/09/__trashed-7/) [3] CoinPedia.org (https://coinpedia.org/crypto-live-news/state-street-predicts-surge-in-institutional-crypto-by-2028/) [4] Forbes on Private Equity and Tokenization (https://www.forbes.com/sites/azeemkhan/2025/05/04/why-private-equity-is-betting-on-tokenization/) [5] JPMorgan Crypto Adoption Analysis (https://www.coindesk.com/markets/2025/09/10/crypto-institutional-adoption-appears-to-be-in-the-early-phases-jpmorgan) [6] PwC Tokenization in Financial Services (https://www.pwc.com/us/en/tech-effect/emerging-tech/tokenization-in-financial-services.html) [7] Coinbase and EY-Parthenon 2025 Survey (https://www.coinbase.com/institutional/research-insights/research/market-intelligence/2025-institutional-investor-survey)