The global financial landscape is experiencing ongoing disruptions as trade tensions spike and the future of digital currencies are weighed by governments. Bitcoin has crossed the threshold from speculative asset to institutional staple, forcing a rethink across capital markets and sovereign treasuries.
What was once dismissed as the preserve of speculative traders and libertarian enthusiasts is now establishing itself as a cornerstone of institutional portfolios.
Recent developments, from the Singapore Exchange(SGX) announcing plans to launch Bitcoin perpetual futures in 2H2025 to debates in the US about adding Bitcoin to sovereign reserves, suggests a paradigm shift in how governments and traditional financial institutions view this digital asset.
Bitcoin’s growing presence on institutional balance sheets and sovereign reserves is more than just adoption, it signals a shift in capital market structures where digital assets play a core role. The question facing the financial establishment is no longer if to embrace Bitcoin, but how swiftly.
Bitcoin is uniquely suited for financing, offering unique benefits that make it an attractive option for traditional finance. Its transparency, through on-chain verifiability, makes it harder to rehypothecate (re-pledging the same asset multiple times), improving the security of transactions.
With cheap storage and custody, the digital currency provides cost-effective solutions for financial institutions, while mobility allows for instant transferability in margin calls, making it a flexible asset for liquidity management.
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Institutional staple
SGX’s decision to introduce Bitcoin perpetual futures is more than just a technological or market milestone. In a jurisdiction where cryptocurrency has till now been regulated largely as a Digital Payment Token, the move marks an important elevation of Bitcoin to a recognised capital market or investment asset.
SGX’s product will offer a trusted and regulated venue for an entirely new pool of investors — particularly those for whom crypto-native exchanges, which bundle trading, clearing, settlement and market-making into a single platform, are simply too unconventional or risky.
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Some may consider Singapore’s approach contradictory, given past warnings against retail cryptocurrency speculation, but in fact it conveys a powerful message: Bitcoin is different from the broader cryptocurrency universe.
Where many tokens have been met with rightful caution, Singapore’s support for a Bitcoin futures market signals that it recognises Bitcoin as investment-grade rather than a gambling instrument.
As more governments and sovereign wealth funds consider Bitcoin as a strategic reserve asset, its liquidity allows for easy disposal in times of need, while its strong capital appreciation expectations are increasingly seen not only as a store of value but also as a significant contributor to enhancing the value of sovereign reserves.
Further adoption
In the US, conversations around adding Bitcoin to sovereign reserves have intensified, especially given the government’s existing Bitcoin holdings from past seizures.
If the US were to include Bitcoin as part of its strategic reserves, it could herald a domino effect. Much as central banks have historically amassed gold, other major economies may feel compelled to follow suit.
In turn, sovereign wealth funds, family offices and large multinational corporations might accelerate their own Bitcoin acquisitions, further solidifying its status as a strategic reserve asset.
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Historically, traditional exchanges have hesitated to engage deeply with digital assets, citing regulatory uncertainties and market volatility. Yet, the tide is now turning.
It is only a matter of time before every major traditional exchange in the world offers a Bitcoin product. SGX’s foray into Bitcoin perpetual futures is significant not just for Singapore or Asia, but for all global financial centres looking to compete in digital asset innovation.
We have already witnessed publicly listed companies enjoying significant market value appreciation after incorporating Bitcoin into their treasuries.
At the same time, structured credit products backed by Bitcoin have begun to deliver lower financing costs for corporate borrowers. The recent wave of bond-like Bitcoin instruments, akin to MicroStrategy’s convertible debt issuance, demonstrates the scale of this financialisation.
One of the key obstacles that has historically hampered broader Bitcoin adoption has been counterparty risk. While crypto-native exchanges pioneered the market, their all-in-one approach is often unpalatable to institutions seeking clearer lines of responsibility and risk management.
By contrast, SGX’s perpetual futures contracts, offered under robust compliance and oversight frameworks, provide a level of institutional-grade security that was lacking in purely crypto-native platforms.
As a result, institutions now have a regulated environment in which to trade Bitcoin, which should instill far greater confidence.
Financial entities that once remained on the sidelines due to issues ranging from custody to regulatory clarity will now be able to participate, inevitably ushering in a new pool of investors to join the ranks of the early adopters and the crypto-savvy.
Regulated markets
A number of Asian hubs are emerging as leading contenders in the race to integrate digital assets into traditional finance, with Singapore and Hong Kong fostering regulated environments for Bitcoin trading.
With mobility across platforms that allow institutions to tap into new financing models, as well as instant transferability for margin calls, Bitcoin-backed structured credit products are able to offer lower financing costs for corporate borrowers.
Singapore and Hong Kong are both vying to become the region’s pre-eminent hubs for regulated digital asset markets, while the Middle East, specifically Abu Dhabi, is classifying digital assets as capital market instruments, reinforcing global institutional acceptance.
For banks, asset managers and other financial intermediaries around the world, the choice is becoming stark: innovate or risk obsolescence.
Over the coming decade, interest rates, equity valuations and central bank policy will no longer be the sole determinants of market behaviour; digital assets (and Bitcoin in particular) are poised to form an integral layer of capital market structures.
The emergence of Bitcoin-backed structured credit markets is likely to be the next frontier. As corporates, institutions and eventually sovereign entities expand their Bitcoin holdings, the demand for innovative instruments such as Bitcoin-backed bonds, swaps and other derivatives will only intensify.
Regulatory harmonisation across borders remains a challenge, but the direction of travel is unmistakable with the new US administration in the White House, which is partly why 2025 feels like a watershed moment for the asset class.
Whether in Singapore, the US or elsewhere, the acceptance of Bitcoin as a legitimate, strategic and investment-grade asset is happening in real time. Looking ahead, as more corporations and institutions increase their Bitcoin holdings, the demand for innovative instruments such as Bitcoin-backed bonds, swaps and derivatives will likely surge.
The expectations for strong capital appreciation will further solidify Bitcoin's role as a cornerstone asset in structured financing markets well into the future.
Darius Sit is the founder and chief investment officer of QCP, a Singapore-based digital asset trading firm
