What insurers need to know about crypto, tokenisation and stablecoins
Digital assets remain outside the investment framework of the vast majority of insurers, and the barriers, capital charges, volatility, and regulatory complexity, are real. But the sheer growth in the size and liquidity of the asset class means it merits a closer look, even for the most conservative allocators.
Our latest paper addresses the specific questions the Mercer Insurance Team has fielded from CIOs and actuaries over the past two years, moving beyond headlines to examine the practical realities of capital treatment, custody, tokenisation and stablecoins.
Three key takeaways:
- Exposure can be accidental as much as intentional. Any carrier with S&P 500 or Nasdaq index exposure now holds Coinbase and Strategy. The separation of traditional and digital assets at the portfolio level may be less clean than it appears.
- Capital treatment may be the decisive barrier, but the distinction matters. Direct coin holdings are non-admitted under the National Association of Insurance Commissioners (NAIC) rules, but ETF and regulated fund structures could offer a capital-efficient route to admitted exposure, a nuance with balance sheet implications.
- Tokenisation and stablecoins could have operational relevance beyond investment. With tokenised Treasuries surpassing $7 billion in AUM[1], the paper examines what faster settlement, fractional ownership and programmable compliance could mean specifically for insurer workflows.
For a full analysis of the regulatory, accounting and risk-management considerations, including the barriers to direct allocation and the structures that navigate them, read the complete paper.
