According to a new report from The Economist, institutional investors' optimism about digital assets continues to rise, and their digital asset allocation is expected to increase to 7% by 2027. Despite challenges such as lack of regulatory consistency and fragmented liquidity in this area, the market size of tokenized assets is expected to exceed $10 trillion by 2030. At the same time, more and more institutional investors are beginning to explore investment tools other than holding cryptocurrencies, such as staking and derivatives.

Key Points

- Institutional investors are optimistic about digital assets and have begun to actively invest in different financial instruments such as staking and derivatives.

- According to the report, institutional investors' allocation to digital assets is expected to reach 7% by 2027.

- Currently, digital asset allocations of institutional asset managers are only between 1% and 5%.

- 51% of institutional investors are considering investing in spot cryptocurrencies.

- The lack of uniformity in regulatory frameworks poses compliance and risk management challenges to institutional investors.

- The problem of fragmented liquidity can lead to market instability and make it difficult for institutions to execute transactions.

- Through technologies such as native token transfers, institutional investors are looking for new ways to solve the problem of fragmented liquidity.