Institutions Rebuild Portfolios: Blockchain Drives Strategic Shift to Tokenized Assets

Institutional investors are accelerating their embrace of digital assets, with most planning to double their crypto holdings within three years, according to a new State Street Corp. report. The 2025 Digital Assets Outlook, released October 9, reveals that over 60% of surveyed institutions intend to boost their exposure to tokenized assets, signaling a strategic shift toward blockchain-enabled portfolios. By 2030, more than half of respondents expect 10–24% of their investments to be tokenized, with private equity and fixed income leading the transition .

The study, based on a global survey of 324 senior executives in asset management and ownership firms, highlights tokenization as a key driver of efficiency and liquidity. Nearly 40% of institutions have already established dedicated digital asset units, while 52% cite improved transparency as a primary benefit of adoption . Donna Milrod, State Street's chief product officer, emphasized that the shift is not merely technical but "strategic," with clients reengineering operating models to integrate blockchain infrastructure .

Regional adoption trends underscore the global momentum. Chainalysis' 2025 Global Crypto Adoption Index ranks India, the U.S., and Pakistan as the top three nations, with Asia-Pacific (APAC) dominating growth at 69% year-over-year. Eastern Europe, particularly Ukraine, Moldova, and Georgia, leads per-capita adoption, driven by economic instability and distrust in traditional banking systems . Meanwhile, North America's rise to second place-surpassing $2.2 trillion in crypto transaction volume-reflects regulatory clarity and the approval of spot Bitcoin ETFs .

Tokenization's impact extends beyond institutional portfolios. McKinsey & Co. projects that tokenized financial assets could reach $2 trillion by 2030, with cash, bonds, and loans leading the charge. The firm notes that blockchain-enabled repos and securitization are already delivering operational efficiencies, including 24/7 settlement and reduced compliance costs .

Emerging technologies are further accelerating adoption. Over half of State Street's survey respondents see generative AI and quantum computing as complementary tools to blockchain, enhancing investment operations and data analytics . The convergence of these innovations is reshaping capital markets, enabling real-time portfolio rebalancing and automated compliance .

Retail and institutional adoption are also aligning. The U.S. leads in Bitcoin ownership, with 27% of respondents citing it as their top-performing asset, while Ethereum follows closely. Meanwhile, global crypto ownership hit 12.4% in 2025, with Chainalysis reporting 659 million users worldwide .

Source: [1] State Street Issues 2025 Digital Assets Outlook: Institutions Double Down on Tokenization (https://investors.statestreet.com/investor-news-events/press-releases/news-details/2025/State-Street-Issues-2025-Digital-Assets-Outlook-Institutions-Double-Down-on-Tokenization/default.aspx)

[2] US climbs to second in global crypto adoption as ETFs fuel growth (https://invezz.com/news/2025/09/03/us-climbs-to-second-in-global-crypto-adoption-as-etfs-fuel-growth/)

[3] Tokenized financial assets: From pilot to scale | McKinsey (https://www.mckinsey.com/industries/financial-services/our-insights/from-ripples-to-waves-the-transformational-power-of-tokenizing-assets)

[4] The Chainalysis 2025 Global Adoption Index (https://www.chainalysis.com/blog/2025-global-crypto-adoption-index/)