The Crypto Wall: Why Funds Hold Back

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Despite surging hype around crypto, over 97% of major institutional fund managers are keeping their distance, exposing a stark reality behind the digital asset frenzy.

Story Snapshot

Bank of America’s August 2025 survey shows 97% of institutional fund managers hold zero crypto assets.
Those with any crypto exposure allocate on average just 3.2%, underscoring deep skepticism among big money players.
Institutional reluctance persists despite crypto’s mainstream profile and growing retail investor participation.
Core barriers include regulatory uncertainty, volatility, and recent high-profile crypto collapses.

Bank of America Survey Reveals Reluctance Among Institutional Investors

In August 2025, Bank of America released its Global Fund Manager Survey, revealing that a staggering 97% of institutional fund managers have no exposure to cryptocurrencies in their portfolios. Even among the minority who do invest in digital assets, the average allocation is a mere 3.2%. This disconnect between the media’s portrayal of crypto’s inevitability and the actual positions of the world’s biggest, most conservative investors signals a persistent skepticism that has not been shaken by years of industry growth or mainstreaming efforts.

📊 STATS: 75% of global fund managers have zero crypto allocation in their portfolios, while only 9% hold any digital assets, according to BofA's latest survey. pic.twitter.com/JdKTEcAyAl

— Cointelegraph (@Cointelegraph) August 18, 2025

The survey, which covers roughly 400 global fund managers responsible for trillions in assets, is widely recognized as a leading indicator of institutional sentiment. For years, it has tracked the slow, cautious approach most major funds take toward crypto despite periodic market booms and relentless retail enthusiasm. Notably, this most recent data follows a string of highly publicized crypto failures, such as the collapse of FTX, which have reinforced the perception of digital assets as volatile and risky. While retail investors and some hedge funds continue to experiment, most traditional asset managers remain on the sidelines, wary of regulatory uncertainty, custody challenges, and compliance risks.

The average professional fund manager allocation toward crypto is 0.3% of AUM. 75% of Fund Managers have zero allocation. Source: BofA pic.twitter.com/u2kxypXmMB

— zerohedge (@zerohedge) August 17, 2025

Regulatory and Risk Barriers Drive Institutional Caution

Several key factors continue to keep institutional money at bay. Regulatory ambiguity in major jurisdictions means that compliance risk remains high, making it difficult for large funds bound by fiduciary duty to justify meaningful crypto allocations. The memory of high-profile collapses and the resulting market volatility only add fuel to this caution. Even as some regulations mature and new products like futures ETFs become available, the average allocation among those exposed remains low, and the vast majority of managers report no structural crypto positions. This stands in sharp contrast to the retail-driven hype and speculative booms that dominate headlines.

In addition, the survey highlights efforts by fund managers to prioritize traditional assets such as equities, bonds, and real estate. These established vehicles offer stability, regulatory clarity, and time-tested risk management, reinforcing the divide between crypto’s public image and its actual institutional adoption. The reluctance among big money players is not just a matter of personal preference—it reflects deep concerns about operational security, asset custody, and the long-term viability of unregulated markets.

Impact on Crypto Markets and Broader Industry Trends

Institutional hesitation has significant consequences for the broader crypto ecosystem. In the short term, it means that retail and speculative capital continue to dominate, resulting in volatile price swings and an ongoing perception of cryptocurrencies as fringe or high-risk investments. Without robust institutional participation, the crypto market’s path toward stability, legitimacy, and mainstream acceptance remains limited. Over the long term, unless regulatory clarity and risk management solutions improve, this divide could slow the integration of digital assets into traditional finance and limit their economic impact.

As long as these barriers persist, big money is likely to continue dodging crypto, keeping the asset class on the margins of global finance. Conservative observers may see this as a prudent defense against unproven, volatile markets and a reaffirmation of the value of regulatory oversight and traditional asset allocation.