Institutional investors and wealth managers are forecasting a significant increase in the launch of new digital asset funds this year, as traditional financial institutions show heightened interest in the sector, according to a report by London-based Nickel Digital Asset Management.
The research indicates that approximately 70% of respondents expect a rise in digital asset-focused fund launches over the next 12 months compared to the previous year, with 14% predicting dramatic growth.
The study, which surveyed organizations invested in digital assets across the US, UK, Germany, Switzerland, Singapore, Brazil, and the United Arab Emirates, highlights growing engagement from traditional financial players managing a combined $1.7 trillion in assets.
Nickel’s findings reveal that up to 93% of those questioned believe traditional firms will increase their digital asset fund offerings within the next three years, with 38% anticipating a substantial surge.
A key driver of this trend is the success of BlackRock’s first tokenized fund, BUIDL, launched in March on the Ethereum network. Currently managing around $500 million in assets under management (AUM), BUIDL is expected by 95% of investors surveyed to reach approximately $10 billion by the end of 2025.
BUIDL offers a stable value of $1 per token and generates yield through the distribution of additional tokens. By primarily holding short-term US Treasuries, the fund mitigates counterparty risk, allowing investors to earn interest while maintaining a one-to-one linkage to the US dollar.
The study found that 85% of investors find BUIDL appealing as an alternative to other stablecoins, while 12% emphasized the need for broader accessibility beyond institutional investors.
Additionally, 5% of respondents are already invested in tokenized funds like BUIDL, and another 13% plan to invest within the next year. Nearly all participants (99%) indicated they are or will be invested in similar funds within four years.
Nickel’s research underscores a growing confidence in digital assets among institutional investors, driven by successful fund launches and the potential for stable, yield-generating investment opportunities in the evolving financial landscape.
