Majority of Japan's Institutional Investors Set to Enter Crypto Market Within Three Years

Japan's institutional investors are increasingly embracing cryptocurrency, with nearly 80% planning to invest in digital assets over the next three years, according to a survey by Nomura and Laser Digital. This shift is driven by a growing perception of crypto as a tool for diversification, with many respondents citing its low correlation with traditional assets as a key factor. Although allocations are expected to be modest, with over half of respondents targeting allocations between 2% and 5% of their portfolios, the trend reflects improving sentiment towards crypto, with 31% of respondents viewing their outlook as positive, up from 25% in 2024. As Japan continues to refine its regulatory framework for digital assets, major companies such as SBI Holdings and bitFlyer are driving the domestic crypto ecosystem, while traditional financial institutions are also entering the market. The survey found that interest in crypto extends beyond simple price exposure, with over 60% of respondents expressing interest in income-generating strategies and derivatives. Stablecoins are also gaining attention, with 63% of respondents identifying potential use cases such as treasury management and cross-border payments. While challenges such as valuation frameworks, counterparty risks, and regulatory uncertainty remain, investors are now focused on how to invest in crypto rather than whether to do so.