Family Offices Are Piling Into Crypto – But 2026’s Volatility Could Wipe Out Gains

Family offices aren't just dipping a toe in crypto anymore—they're diving in headfirst. The ultra-wealthy's private investment firms are aggressively expanding their digital asset portfolios, chasing the asymmetric returns traditional markets can't offer. This isn't fringe speculation; it's a calculated allocation shift by the capital that moves markets.

The Bull Case: Beyond Bitcoin

Forget just buying Bitcoin and hoping. Sophisticated strategies now dominate. They're staking Ethereum for yield, financing decentralized infrastructure projects, and building positions in layer-1 protocols poised to eat Wall Street's lunch. The thesis is simple: digital assets represent the most profound value transfer since the internet, and family offices aim to be on the founding cap table, not buying the IPO.

The 2026 Storm Cloud

But here's the rub: 2026 looks treacherous. Macroeconomic crosswinds—persistent inflation, whipsawing interest rates, and geopolitical flashpoints—threaten to trigger crypto's infamous volatility. A market that can double in a year can halve in a month. For these offices, the question isn't if they'll get exposure, but whether their risk frameworks are robust enough to avoid becoming exit liquidity for the next cycle. After all, in finance, the 'smart money' is often just the last to get the memo before the music stops.

The path forward demands conviction, not just capital. The families that navigate the coming volatility won't do it with spreadsheets alone—they'll need the stomach to hold through drawdowns that would make a hedge fund manager blanch. The 2026 outlook isn't cloudy; it's a hurricane warning.

Family Offices Favor Bitcoin and Ether as Infrastructure Improves

Yesilhark added that most allocations focused on areas where infrastructure, custody solutions and risk controls had improved.

Despite broader interest, Bitcoin and Ether remained the main entry points, reflecting limited in-house crypto expertise at many family offices.

Survey data points to a rapid rise in engagement. A study by BNY Mellon published in October found that 74% of ultra-high-net-worth family offices are now investing in or actively exploring cryptocurrencies, up 21 percentage points from the previous year.

Market participants say that increase was driven not just by price cycles, but by a more developed ecosystem around custody, compliance and regulated investment vehicles.

Family offices are doing a complete 180 on crypto and are treating it like infrastructure. And the speed of that shift tells you something about where serious money is actually headedhttps://t.co/ukFGXvEcKg
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Chris Rhine, head of liquid active strategies at Galaxy Digital, said his firm saw a noticeable wave of first-time allocations this year.

Many family offices, he noted, conducted detailed due diligence before committing capital, signaling a longer-term approach rather than opportunistic trading.

That cautious entry did not stop some high-profile moves. Hong Kong-based family office VMS made its first crypto investment by backing digital asset hedge fund Re7 with $10 million.

Separately, the family office of Arthur Hayes is planning to raise $250 million for its first crypto-focused private equity fund, underscoring growing institutional confidence in the sector’s infrastructure layer.

IPO Revival Could Pull Family Offices Deeper Into Crypto in 2026

Looking ahead, Pete Najarian, founder and managing partner of Raptor Digital, expects crypto to take up a larger share of family office portfolios in 2026, especially if public markets reopen for digital asset firms.

A more active IPO pipeline, he said, could draw interest from families seeking exposure through exchange-traded funds and other regulated vehicles.

Still, recent market conditions have tempered enthusiasm. The crypto market has shed more than $1 trillion in capitalization since October, with Bitcoin and Ether each down over 30%.

One UAE-based family office representative said the volatility has pushed some investors to favor steadier assets such as real estate. “We are still far from broader adoption,” the person said.

Yesilhark argued that success in 2026 will hinge on discipline. Family offices that focus on infrastructure, selective bets and strong underwriting, rather than short-term speculation, are more likely to stay committed through the next cycle.