Institutional investors are moving beyond simple crypto price bets-now they’re after yield.
Brett Tejpaul, Coinbase’s head of institutional, says the “second wave” of institutional capital is focused on generating steady returns from existing holdings like bitcoin and ether. Instead of just waiting for appreciation, firms are deploying assets into strategies such as options selling and lending.
Coinbase recently launched a tokenized Bitcoin Yield Fund on Base with Apex Group, targeting mid-single-digit returns. BlackRock followed with its iShares Staked Ethereum Trust ETF (ETHB), offering network staking rewards.
This mirrors traditional finance’s structured products-but now on blockchain rails. Tokenization enables 24/7 trading, instant settlement, and transparent ownership tracking, appealing to institutions tired of multi-day legacy settlement cycles.
Stablecoins and tokenized funds are central to this shift. Backed by short-term Treasuries, stablecoins offer cash-like yields while enabling fast, low-cost cross-border payments. BlackRock, JPMorgan, and Franklin Templeton have all launched tokenized funds.
Regulatory progress-including the GENIUS Act for stablecoins and the pending CLARITY Act-is accelerating adoption. Even the NYSE and Nasdaq plan near-continuous tokenized trading.
“Institutions aren’t just asking how to buy crypto anymore,” Tejpaul said. “They’re asking what it can do for their portfolios-and their businesses.”