Mar 26, 2025

Xapo Bank executive discusses the rise of institutional crypto adoption and how regulation is shaping its future. Will crypto dominate traditional finance? The era of institutional crypto adoption is gaining momentum as traditional financial institutions and policymakers start embracing digital currencies. In a recent interview, Gadi Chait, Xapo Bank investment manager, spoke on how institutions are overcoming previous obstacles and finding their place in the crypto financial market . He attributed regulatory advancements, enhanced confidence, and the potential long-term value of cryptocurrencies as key drivers of adoption. Regulatory Shifts Fuelling Institutional Adoption of Cryptocurrency The institutional crypto adoption environment is shifting, with regulatory environments adapting to include digital assets. A recent survey by Coinbase and EY-Parthenon found that 86% of institutional investors are involved in digital assets. Many plan to increase their crypto allocations in 2025. This marks a major shift from past skepticism about cryptocurrencies. According to Chait, earlier issues such as price volatility and risk of speculative assets, including meme coins, deterred institutional investors. However, with more research and maturing regulatory framework development, businesses are now viewing crypto as a legitimate financial tool. The expanding crypto financial system is now driven by real-world utility, policymaker support, and higher retail participation, building its long-term position in global finance. Trump’s Pro-Crypto Policies Boost Market Confidence President Trump’s return has been a game-changer for the institutional crypto adoption trend. His administration has indicated a pro-crypto approach, hosting the White House Crypto Summit and signing an executive order to create a strategic reserve of cryptocurrencies. Chait emphasized that the shift has “massively buoyed confidence for digital asset firms in the US.” Whereas the previous enforcement actions by the SEC had directly focused on institutions like Gemini and Ripple, support from the current administration has been comforting. This change has comforted institutional investors as well as retail investors, providing relief against regulatory uncertainty. With the recent Bitcoin price surge above $100,000, trust in cryptocurrencies has further gained traction. Conventional financiers such as Morgan Stanley and RBC are struggling to offer crypto services within their portfolios. Such an upsurge points toward a massive development in the cryptocurrency space, welcoming broader institutional inclusion. Xapo Bank’s Role in Institutional Adoption of Crypto Xapo Bank has been a leader in institutional crypto adoption and has taken the status of being a “crypto-first” bank. Since the launch of Xapo in 2013, it has made its stand clear that it is a custodian of safe Bitcoin for long-term investors. Most recently, the bank launched Bitcoin-backed lending products. Chait clarified that although other traditional banks continue to struggle with the uncertainty of regulations, Xapo insists on offering convenient crypto banking products. He mentioned, “Xapo will always be crypto-first,” reiterating the institution’s long-term approach. The Future of Institutional Crypto Adoption The institutional crypto adoption trend does not appear to be slowing down anytime soon. Clarity in regulations and more investment among financial institutions indicate that crypto will become a mainstream asset class. Chait emphasized that with the maturation of infrastructure and the Bitcoin surge, institutional demand will rise. Increased financial participation in the crypto financial market will encourage more innovation and adoption. Digital assets are likely to be integrated into established banking systems more quickly, making cryptocurrency an important component of global finance. The growth of regulatory framework development will continue to stabilize the market, giving institutions the protection they need to trade comfortably. With the advent of crypto-friendly policies, we could be seeing an era where traditional finance and digital assets coexist seamlessly. News Room Editor Newsroom is the editorial team of CoinfoMania, delivering 24/7 crypto news, market insights, and in-depth analysis. With 30+ journalists worldwide, we keep you ahead in the blockchain space.