Hedge funds have intensified their exposure to crypto and alternative assets, pointing to a broader institutional embrace of digital currencies and diversification strategies.
Allocations to Bitcoin, Ethereum, and emerging sectors such as DeFi, NFTs, and tokenized real-world assets grew steadily, with funds employing a mix of long-term holdings, active trading, and derivatives to manage risk and capitalize on volatility.
Tokenized real-world assets are projected to surpass USD 50 billion in 2025, providing hedge funds with improved liquidity and new avenues for alternative investments. In this regard, investors are increasingly eyeing private equity tokenisation as a growing source of opportunity within the expanding real-word asset (RWA) space.
As adoption shifts from pilot initiatives to institutional-scale deployments, hedge funds are expected to deepen their allocation to tokenised assets. The underlying blockchain infrastructure, providing faster settlement, fractionalisation and lower transactional friction, aligns well with the structural needs of hedge fund strategies. With forecasts placing the RWA market at USD 30 trillion by 2034, tokenised assets are likely to feature prominently in the next evolution of alternative investment.
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