Japanese Institutional Investors Show Growing Interest in Crypto Investments

A significant shift is underway in Japan, as institutional investors transition from cautious observation to active investment in crypto, driven by a growing perception of digital assets as a tool for portfolio diversification. A survey conducted by Nomura and Laser Digital found that nearly 80% of the country's institutional investors plan to invest in crypto over the next three years, primarily due to the low correlation with traditional assets. However, allocations are expected to remain modest, with over half of respondents targeting allocations between 2% and 5% of their portfolios. The survey also revealed improving sentiment towards crypto, with 31% of respondents holding a positive outlook, up from 25% in 2024, and a decline in negative sentiment to 18%. Japan's regulatory framework for digital assets, which has been refined over the years, has contributed to this shift. The country's major companies, such as SBI Holdings and bitFlyer, have established a domestic crypto ecosystem, and traditional financial institutions have also begun to enter the industry. The survey found that interest in crypto extends beyond simple price exposure, with over 60% of respondents expressing interest in income-generating strategies and tokenized assets. 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.