Japanese Institutional Investors Show Growing Interest in Crypto Investments

In Japan, the perception of cryptocurrency investment is transitioning from cautious observation to active planning, as evidenced by a Nomura survey, which found that almost 80% of institutional investors plan to incorporate crypto into their portfolios over the next three years. This shift is driven by the increasing view of crypto as a tool for diversification, with many respondents citing its low correlation with traditional assets as a primary reason for investment. However, allocations are expected to be limited, with over half of respondents targeting allocations between 2% and 5% of their portfolios. The survey also reveals improving sentiment towards crypto, with 31% of respondents expressing a positive outlook, up from 25% in 2024, and negative sentiment declining to 18%. These findings come as Japan continues to refine its regulatory framework for digital assets, providing clarity that has fostered a domestic crypto ecosystem. Major companies such as SBI Holdings and bitFlyer are anchoring this ecosystem, and traditional financial institutions are also entering the industry. The survey suggests that interest in crypto is expanding beyond simple price speculation, with over 60% of respondents expressing interest in income-generating strategies and tokenized assets. Stablecoins are also a focus area, with 63% of respondents identifying potential use cases. While challenges such as valuation frameworks, counterparty risks, and regulatory uncertainty remain, investors are shifting their focus from whether to invest in crypto to how to do it. The survey, conducted in December and January, gathered responses from 518 investment professionals, including institutional investors, family offices, and public-interest organizations.