How the Wealthy's Risk Appetite for Crypto Has Evolved Amidst Growing Institutional and Governmental Adoption of Strategic Tech Assets

The global investment landscape in 2025 is marked by a stark divergence between two asset classes: traditional infrastructure and defense projects, and cryptocurrencies. While the wealthy have historically gravitated toward high-risk, high-reward assets like crypto, recent trends suggest a recalibration of risk appetite as institutional and governmental capital increasingly flows into tangible, technology-driven national infrastructure. This shift is exemplified by the Mazagon Dock Shipbuilders (MDL) case study, which highlights the enduring appeal of defense and industrial projects, even as crypto indices continue to deliver outsized returns.

Traditional Infrastructure: The Case of Mazagon Dock

Mazagon Dock Shipbuilders, India's premier naval shipbuilder, has emerged as a linchpin in the country's defense modernization. In 2025, MDL secured a landmark ₹35,000–40,000 crore contract to construct Landing Platform Docks (LPDs) for the Indian Navy, a project that will enhance amphibious operations and humanitarian assistance capabilities. This collaboration with Swan Defence and Heavy Industries (SDHI) underscores the strategic value of physical infrastructure in national security.

MDL's financials further reinforce its appeal. The company reported a 27% year-on-year increase in PAT to ₹715 crores and a 6% rise in revenue to ₹2,929 crores in Q2 2025. With an order book of ₹27,415 crores and ambitions to surpass ₹1 lakh crores by FY27, MDL's growth is anchored in long-term defense contracts like the P75I submarine project and its new ₹5,000 crore greenfield shipyard in Tuticorin. These projects, though capital-intensive, offer predictable cash flows and geopolitical alignment, making them attractive to institutional investors prioritizing stability over volatility.

Crypto's High-Return Allure vs. Institutional Skepticism

Cryptocurrencies, by contrast, have maintained their allure for aggressive investors. In 2025, crypto indices outperformed traditional portfolios (Value Investor Index: 86% annual return, Sharpe ratio 1.68; Momentum Trader Index: 147% annual return, Sharpe ratio 2.09). However, recent data reveals a cooling trend in institutional adoption. CoinShares reported $1.94 billion in outflows from Bitcoin and crypto assets in a single week, with Ethereum and Bitcoin leading the exodus. This contrasts sharply with the 60/40 portfolio's historically lower returns (7.2% annualized, Sharpe ratio 0.48), yet the outflows suggest a recalibration of risk tolerance among institutional players.

Notably, XRP bucked this trend with $89.3 million in inflows, partly due to Franklin Templeton's launch of a regulated XRP ETF on NYSE Arca. This highlights crypto's fragmented appeal: while speculative assets like XRP attract niche interest, broader institutional confidence remains fragile.

Strategic Tech and Defense: A New Frontier for Institutional Capital

The growing institutional focus on strategic technology and defense mirrors MDL's trajectory. For instance, NUBURU's €15 million partnership with Tekne S.p.A. to expand defense operations-focusing on unmanned aerial systems (UAS) and critical infrastructure security-exemplifies transatlantic collaboration in high-tech sectors. Such ventures, backed by government incentives and joint R&D, offer a blend of innovation and geopolitical utility that resonates with institutional investors.

Governments are also prioritizing defense tech. The U.S. and EU have ramped up funding for AI-driven logistics, cyber defense, and autonomous systems, creating a fertile ground for companies like Tekne and NUBURU. These investments, unlike crypto, are often insulated from market volatility and tied to long-term national priorities.

The Wealthy's Evolving Risk Matrix

The wealthy's risk appetite now hinges on a nuanced calculus. While crypto's high Sharpe ratios and ROI remain enticing, its recent outflows and regulatory uncertainties have prompted a shift toward assets with clearer utility and government backing. MDL's LPD project and NUBURU's UAS ventures represent a "middle ground"-they combine technological innovation with tangible, mission-critical applications, offering both growth and geopolitical alignment.

For investors, the key takeaway is clear: crypto's role as a speculative, high-volatility asset persists, but its dominance in the wealthy's portfolio is being challenged by strategic infrastructure and defense projects. These traditional investments, once seen as conservative, are now rebranded as high-impact, future-proofing assets in an era of geopolitical and technological disruption.