A survey shows that the number of U.S. financial advisors allocating crypto in their clients’ portfolios has increased significantly as of 2019. The numbers show that in 2020 they increased 49% from 6.3% to 9.4%.
A large majority of advisors also have personal crypto investments
According to San Francisco-based asset management firm Bitwise, 58% of advisors who assign crypto are independent Registered Investment Advisors (RIAs).
The report says the finding is not surprising. In fact, RIAs have no restrictions on the types of investments they can put in portfolios.
The study also shows that the vast majority of advisors with clients who invest in crypto have made personal investments in this area. According to the message:
82% of consultants reporting crypto client assignments also indicated a personal investment in the area.
Consultants are still interested in increasing their crypto positions
The report also notes that 78% of consultants surveyed are considering increasing their clients’ crypto allocation over the next 12 months. However, 12% of them will remain “stable”, according to the study.
In addition, no advisors reported plans to reduce or remove their current crypto positions. The survey adds:
The percentage of consultants planning to increase their clients’ association with crypto has increased significantly this year. Last year, only 42% of consultants with client referrals reported plans to increase that referral.
In terms of reasons for adding crypto assets to clients’ portfolios, the survey found a “sharp increase” in advisors who praised crypto’s “high potential returns”. They also pointed to the role of crypto in “hedging against inflation” as an attractive trait for the asset class. Notated bit by bit:
38% (38%) of consultants said that “high return potential” is an attractive feature of crypto, compared to 30% in last year’s survey. By far the largest increase, however, was the “inflation hedge”, which was 25%. the consultant highlighted as an attractive feature, up from only 9% in last year’s results. Interest in instruments to hedge against inflation has increased significantly over the past year, and a number of well-known institutional investors publicly highlighted Bitcoin as a potential hedge against inflation risks over the past year.
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