Japanese Institutional Investors Show Growing Interest in Crypto Investments

In Japan, the approach to cryptocurrency investment is transitioning from cautious observation to active planning, as revealed by a Nomura survey conducted in collaboration with Laser Digital. The survey found that nearly 80% of institutional investors in the country plan to incorporate cryptocurrencies into their portfolios over the next three years, driven by a growing perception of crypto as a tool for diversification. The primary reason cited for this shift is the low correlation between crypto and traditional asset classes, allowing for more diversified investment portfolios. However, the allocations are expected to be modest, with over half of the respondents aiming to dedicate between 2% and 5% of their portfolios to crypto. The survey also indicates an improvement in sentiment towards crypto, with 31% of respondents expressing a positive outlook, up from 25% in 2024, and negative sentiment decreasing to 18%. These findings emerge as Japan continues to refine its regulatory framework for digital assets, one of the most established among major economies. The country's early adoption of crypto regulations, following the 2014 Mt. Gox collapse, has contributed to the development of a robust domestic crypto ecosystem. Major companies such as SBI Holdings and bitFlyer are at the forefront of this ecosystem, and traditional financial institutions are also entering the market. Nomura's establishment of Laser Digital in 2022 marks a significant expansion into crypto trading, asset management, and venture investing. Furthermore, over 60% of respondents expressed interest in strategies that generate income, such as staking and lending, as well as derivatives and tokenized assets, indicating a shift towards treating crypto as a comprehensive financial tool rather than a speculative investment. Stablecoins are another area of interest, with 63% of respondents identifying potential use cases including treasury management and cross-border payments. Despite the growing interest, challenges persist, including the lack of established valuation frameworks, counterparty risks, and regulatory uncertainty. Nonetheless, the focus has shifted from debating the merits of crypto investment to discussing the best approaches to implementation.