Key Highlights
- State Street’s 2025 global digital assets report noted that almost 60% of institutional investors are willing to add to their cryptocurrency holdings in the next 12 months.
- The majority of institutions project that between 10% and 24% of their portfolios will be tokenized by 2030 and seek to adopt private equity and fixed income early on.
- Approximately 40% of companies already employ specialized digital asset staff, and more than half consider AI and quantum computing to be additional drivers of finance-related digital transformation.
A recent report by financial giant State Street with $5.1 trillion AUM indicates that traditional finance is about to change significantly. The findings show that almost 60% of institutional investors intend to invest more in cryptocurrencies and tokenized assets over the next twelve months. The results indicate a wide-ranging shift from the direction of cautious experimentation to the outright integration of digital resources into the mainstream investment policies.
The information is a reflection of the mood of senior managers in asset management and asset ownership companies all over the world based on the State Street 2025 Global Research on Digital Assets and Technology. According to the report, digital assets have shifted in terms of being minor investments to being core elements of institutional portfolios.
State Street Expects Increase in Adoption of Bitcoin
According to the survey, the average institutional allocation to digital assets will increase twofold over the three-year period, which indicates that there is increased confidence in blockchain infrastructure and tokenization. To most companies, small-scale pilot projects have transformed into corporate levels of adoption.
According to Joerg Ambrosius (President of Investment Services at State Street), the rate of change within the sector is increasing fast. “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,” Ambrosius said.
Targets Private Markets with Tokenization
The report lists the first asset classes that are being tokenized on a large scale as private equity and private fixed income. Traditionally illiquid markets are getting redefined by blockchain in a bid to enhance liquidity and efficiency in their operations.
The findings of State Street show that 10% to 24% of portfolios of most of the surveyed institutions are expected to be tokenized by 2030. The case is mostly financial: increased transparency, quicker transactions, and lower cost.
On questioning them about the motivation behind their digital move, 52% of the respondents mentioned the urge to have a better look at their portfolio holdings. A further 39% of them placed more emphasis on the speed of trade execution, and 32% emphasized reduction in the compliance-related costs. Almost half of the respondents think that tokenization would result in a cost reduction of more than 40%, which is mainly due to more transparent and automated data streams.
Also Read: STBL Price Soars As USST Stablecoin Launch Nears
Institutional Operations Undergo A Structural Shift
In addition to the distribution of assets, organizational structures are changing. Approximately 40 percent of organizations currently have a special digital asset division or team, and almost one out of three organizations have built blockchain-based processes into operating models.
According to Donna Milrod, the Chief Product Officer of State Street, clients are radically reengineering their systems to meet digital finance. Milrod said, “We’re seeing clients rewire their operating models around digital assets. “Many are building dedicated teams, and nearly one in five plan to follow suit. From tokenized bonds and equities to on-chain wrappers, Central Bank Digital Currencies, stablecoins, and tokenized cash, the shift isn’t just technical – it’s strategic.”
AI & Crypto Lead the Change
Another intersection that is pointed out in the report is the role of blockchain with other disruptive technologies. Over 50% of the surveyed executives said they believe that generative AI and quantum computing will generate an even larger impact on the investment operations than either blockchain or tokenization.
Nevertheless, these innovations are not seen as competitive but complementary by institutions. According to the respondents, AI data analytics and quantum computing processing power will not replace the digitization of the financial assets but hasten it.
The findings of the 2025 research of State Street create a picture of a fast-changing industry that is shifting to digital infrastructure. It notes that tokenization, blockchain, and artificial intelligence are working simultaneously to restructure the way global finance works.
Also Read: Sen. Lummis Responds to Jack Dorsey’s Demand For A Bitcoin Tax Exemption
