Crypto Craze Sweeps Hedge Funds As 55% Add Digital Assets To Portfolios
According to AIMA and PwC’s Seventh Annual Global Crypto Hedge Fund Report, more than half of traditional hedge funds now hold crypto.
The survey shows 55% have some crypto exposure, up from 47% in 2024. That number alone signals a shift in how mainstream managers treat these assets.
Crypto: Broad Adoption, Small Stakes
Most managers are being careful, for now. Many funds keep their digital currency positions tiny. Over half of those with exposure hold less than 2% of their portfolios in crypto.
On average, funds put about 7% into crypto-related investments. Yet plans point upward: 71% of holding funds say they will raise their positions over the next 12 months.
Risk is on their minds. Reasons given include portfolio diversification (47%), market-neutral alpha opportunities (27%), and asymmetric return potential (13%).
The survey’s scale gives weight to the trend. The report asked 122 hedge fund managers controlling over $980 billion in assets. That sample shows a 17% year-over-year increase in the share of funds holding crypto.
Source: AIMA research paper
Many managers prefer indirect exposure. According to the findings, 67% use digital currency derivatives — up from 58% in 2024 — which lets them take positions without holding coins directly.
That approach can be safer on paper. But it also carries risks. The October 2025 flash crash caused close to $20 billion in liquidations, a stark reminder of what can happen when markets move quickly.
Source: AIMA research paper
How Funds Gain Market Exposure
Spot trading is growing while derivatives remain popular. Spot trading grew from 25% to 40% as a method of access. Exchange-traded products account for 33%.
Tokenized assets and related equities each sit at 27%. The numbers show funds want choice. Derivatives offer flexibility; spot gives direct ownership. Both have places in portfolios, depending on rules and risk limits.
Crypto-native funds are getting bigger. Pure crypto managers report larger pools of capital. Average assets under management reached more than $130 million in 2025, compared with $79 million in 2024 and over $40 million in 2023.
The coins held most often are Bitcoin (86%), Ethereum (80%), Solana (73%), and XRP (37%). Solana’s adoption jumped from 45% last year. Yield strategies are widespread too — custodial staking is used by 39% of crypto funds and liquid staking by 35%.
Source: AIMA research paper
Institutional Interest Up
Institutional interest is rising, but barriers remain. Fund-of-funds participation rose to almost 40% in 2025 from 21% in 2024. Institutional allocations from pension funds, foundations, and sovereign wealth funds climbed to 20% from 11%.
Two-thirds of institutional investors surveyed now allocate to digital assets. Yet half of traditional hedge funds without crypto say they will not invest in the next three years.
Featured image from Unsplash, chart from TradingView
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