The institutional approach to cryptocurrency is undergoing a fundamental shift. Brett Tejpaul, Coinbase's head of institutional, told CoinDesk that the "second wave" of institutional money is moving beyond simply banking on Bitcoin's price going up. Instead, large investors want to put their digital assets to work generating income while they wait for long-term appreciation.
Coinbase Launches Tokenized Bitcoin Yield Fund
Many institutions already hold bitcoin ($64,169) and ether on their balance sheets. To meet growing demand, Coinbase last week partnered with Apex Group, a fund services provider overseeing $3.5 trillion in assets, to launch a tokenized share class of its Bitcoin Yield Fund on the Base network. The fund generates yield through strategies such as selling call options and lending bitcoin, targeting mid-single-digit returns depending on market conditions. Tejpaul calls this a natural evolution: from passive holding to active yield generation.
BlackRock Enters Staking with ETH Staked ETF
The world's largest asset manager, BlackRock, is taking a similar route. It recently introduced the iShares Staked Ethereum Trust ETF (ETHB), which gives investors exposure to the rewards earned by helping secure the Ethereum network. The product signals that demand for yield-bearing crypto strategies is spreading across traditional finance. Tejpaul compared this to structured products in conventional markets, where assets are combined with options to deliver targeted returns. As U.S. regulators provide clearer rules, traditional investors are replicating those structures in crypto.
Blockchain Speeds Up Settlements; Stablecoins and Tokenization Take Center Stage
The second wave is also about operational efficiency. Tejpaul said nearly half of his conversations with institutions now involve stablecoins and tokenization. Large financial firms are exploring blockchain systems to move money faster, especially across borders, and to enable 24/7 settlement. The growing regulatory clarity in the U.S. since 2025 has encouraged banks and asset managers to integrate on-chain infrastructure.
In short, institutional crypto is no longer just about holding—it's about using digital assets for income and efficiency, bridging the gap between crypto and mainstream finance.