Family Offices Are Set to Eclipse Hedge Funds—and Digital Assets Will Reap the Rewards

The CNBC article from September 5, 2024, titled "Family offices are about to surpass hedge funds, with $5.4 trillion in assets by 2030," provides a compelling baseline for understanding the rapid growth of family offices as a dominant force in wealth management. It forecasts that family office assets will grow from $3.1 trillion today to $5.4 trillion by 2030, surpassing the asset base of hedge funds, which have historically been a cornerstone of high-net-worth (HNW) and institutional investing. This shift is driven by a rising number of single-family offices—projected to increase from 8,000 to 10,720 globally by 2030—and a preference among the ultra-wealthy for privacy, customization, and control over their investments. As family offices expand, their investment strategies are evolving, with a notable pivot toward alternative assets. This trend aligns closely with the ongoing digital asset revolution, particularly in tokenized offerings such as yield-bearing stable tokens, positioning this sector to benefit disproportionately from the influx of family office and high-net-worth individual (HNWI) capital.

The Rise of Family Offices and Their Investment Preferences

The Deloitte Private report cited in the CNBC article highlights that family offices are increasingly institutionalizing, moving beyond basic portfolio management to operate as boutique investment firms with an average staff of 15 managing $2 billion in assets. A key shift is their allocation to alternative investments, which now constitute 46% of their portfolios according to the J.P. Morgan Private Bank Global Family Office Report. Private equity leads at 19%, but family offices are also diving into direct deals and exploring newer asset classes like digital assets. This appetite for alternatives stems from a desire for higher returns, diversification, and alignment with long-term family goals—attributes that digital assets, particularly tokenized offerings, are well-suited to deliver.

North America, home to 3,180 family offices today and projected to reach 4,190 by 2030, is leading this charge. The region’s family office wealth has already doubled since 2019 to $2.4 trillion and is expected to hit $4 trillion by 2030. Meanwhile, the global HNWI population—individuals with at least $1 million in liquid assets—grew to 22.8 million in 2023, controlling $86.8 trillion in wealth, per the Capgemini World Wealth Report 2024. Ultra-high-net-worth individuals (UHNWIs), with $30 million or more, are a key driver of family office growth, and their openness to innovative investments is fueling the digital asset surge.

The Digital Asset Revolution and Tokenized Offerings

The digital asset revolution, underpinned by blockchain technology, is transforming traditional finance by enabling the tokenization of real-world assets (RWAs) such as treasuries, real estate, and stablecoins. Tokenized offerings provide liquidity, fractional ownership, and yield opportunities that appeal to family offices seeking both flexibility and returns. Yield-bearing stable tokens, in particular, have emerged as a standout category. These are blockchain-based assets pegged to stable currencies like the U.S. dollar, enhanced with smart contracts that generate yield through mechanisms like lending, staking, or exposure to low-risk financial instruments.

Data from posts on X and industry reports suggest significant momentum. For instance, tokenized treasuries have seen over $2 billion in year-to-date inflows in 2025, indicating institutional-grade interest in capturing yield through digital channels. Companies like BlackRock, which launched a tokenized money market fund (BUIDL) on Ethereum in March 2024, exemplify this trend. By September 2024, BUIDL had amassed over $500 million in assets, showcasing how traditional financial giants are bridging TradFi and DeFi to cater to HNW investors. Franklin Templeton and other asset managers have followed suit, tokenizing U.S. Treasury bonds and offering yields competitive with traditional fixed-income products, often exceeding 4-5% annually.

Why Family Offices and HNWIs Are Driving This Shift

Family offices and HNWIs are uniquely positioned to capitalize on tokenized offerings due to their investment flexibility and risk tolerance. Unlike hedge funds, which often face redemption pressures and regulatory constraints, family offices manage private capital with a long-term horizon, allowing them to experiment with nascent markets like digital assets. A 2023 survey by KKR and the Family Office Association found that 28% of family offices had already invested in cryptocurrencies or blockchain-related assets, with 15% specifically allocating to tokenized RWAs. This figure is likely higher today, given the accelerating adoption curve.

The appeal of yield-bearing stable tokens lies in their ability to combine stability with income generation. For example, tokens like USDC (Circle’s stablecoin) or emerging yield-enhanced variants offer HNWIs a hedge against inflation while providing returns that outpace traditional savings accounts or government bonds. A report by Dune Analytics in early 2025 noted that DeFi protocols hosting yield-bearing stablecoins—such as Aave or Compound—saw TVL (total value locked) exceed $150 billion, with family offices and HNWIs contributing a growing share via private pools or direct investments.

Moreover, tokenized offerings align with the customization and privacy family offices prioritize. Blockchain’s transparency is paired with pseudonymity, allowing families to invest discreetly while tracking performance in real time. The Deloitte report underscores this, noting that post-financial-crisis distrust in traditional advisors has pushed UHNWIs toward in-house teams that can explore digital assets without conflicts of interest.

Comparative Advantage Over Hedge Funds

Hedge funds, while still managing significant assets (estimated at $4 trillion globally per Preqin data), are losing ground to family offices in adaptability to the digital asset space. Hedge funds often rely on leveraged, high-risk strategies and cater to a broader investor base, diluting their focus on bespoke solutions. Their “two and twenty” fee structure—2% management fee and 20% performance fee—also contrasts with family offices, which avoid such costs by managing investments internally. This cost efficiency allows family offices to allocate more capital to experimental assets like tokenized offerings without the pressure of short-term performance metrics.

Additionally, regulatory scrutiny on hedge funds limits their agility in crypto markets. The SEC’s classification of many tokens as securities has deterred some funds, whereas family offices, as private entities, face fewer restrictions. A 2024 Bloomberg article noted that hedge funds reduced crypto exposure by 12% in 2023 amid regulatory uncertainty, while family office allocations rose by 18% over the same period, per BNY Mellon estimates.

Broader Implications and Supporting Data

The digital asset revolution’s growth is not just anecdotal. The global market for tokenized assets is projected to reach $10 trillion by 2030, according to a 2024 McKinsey report, with RWAs like treasuries and stablecoins leading the charge. Family offices, expected to control over $5.4 trillion by then, could direct 20-30% of their alternative allocations—roughly $1-1.5 trillion—into digital assets, dwarfing hedge fund contributions. Posts on X from early 2025 highlight family offices “quietly shifting” into tokenized treasuries, a sentiment echoed by industry leaders at events like the 2024 TOKEN2049 conference, where Web3 adoption by family offices was a recurring theme.

In Asia-Pacific, where family office numbers are set to rise from 2,290 to 3,200 by 2030, interest in digital assets is particularly pronounced. A 2024 UBS Global Family Office Report found that 35% of Asia-based family offices plan to increase crypto and blockchain investments by 2026, driven by tech-savvy younger generations inheriting wealth.

Conclusion

As family offices overtake hedge funds in asset growth, the digital asset revolution stands to gain the most from their investment priorities. Tokenized offerings, especially yield-bearing stable tokens, offer a compelling mix of stability, yield, and innovation that resonates with the privacy, customization, and long-term focus of family offices and HNWIs. With over $2 billion already flowing into tokenized treasuries in 2025 and projections of $5.4 trillion in family office assets by 2030, the convergence of these trends signals a transformative shift. While hedge funds remain relevant, their structural constraints pale against the agility and capital firepower of family offices, positioning digital assets as a prime beneficiary of this wealth management evolution.