What to know:

Institutional investors are shifting from pure price speculation in crypto toward strategies that generate steady income from assets they already hold.

New products such as Coinbase's tokenized Bitcoin Yield Fund and BlackRock's staked-ether ETF reflect growing demand for yield-bearing, onchain vehicles that resemble traditional cash and bond strategies.

As interest in stablecoins, tokenization and 24/7, near-instant settlement grows, large financial firms are exploring how blockchain infrastructure can cut costs, speed cross-border payments, and improve capital efficiency.

Institutional investors aren't just betting on 'number go up' strategy for crypto anymore, they are shifting to hunting for steady sources of income from major digital assets.

Many institutions already hold bitcoin and ether (ETH) on their balance sheets. While they are holding these assets for the long-term price appreciation, investors are increasingly seeking to put them to work to earn income while waiting, said Brett Tejpaul, Coinbase's (COIN) head of institutional, in an interview with CoinDesk, noting that this is how the next phase of institutional money entering the digital asset sector will look.

"The second wave of institutions… is underway. It's happening."

That shift is shaping a new wave of products, he said. Coinbase last week launched a tokenized share class of its Bitcoin Yield Fund on Base in partnership with Apex Group, a $3.5 trillion fund services provider. The fund aims to generate yield through strategies such as selling call options or lending bitcoin, with target returns in the mid-single digits, depending on market conditions.

The push for yield is not limited to just crypto-native firms.

BlackRock, the world's largest asset manager, has also moved in this direction. The firm recently launched the iShares Staked Ethereum Trust ETF (ETHB), giving investors exposure to rewards generated by helping secure the network. The product signals that demand for yield-bearing crypto strategies is spreading across traditional finance.

This is a similar strategy to what traditional investors call 'structured products.' These financial instruments include assets with options that are designed to deliver certain returns or yields. With many options and yield-generating strategies now available in the digital assets sector, traditional investors are seeking similar products in crypto, especially as lawmakers set clearer regulations for the sector.