Advisors Remain Positive on Crypto Despite 2022

[ad_1]

Last year was a tough year for crypto investments, but most advisors who responded to a recent Bitwise Asset Management/VettaFi survey plan to increase or maintain their exposure to alternative investing.

The survey found that while most advisors have clients invested in crypto, only 15% manage their clients’ crypto investment strategies, with many responding that they don’t have access to crypto strategies on behalf of of their customers. There is a key opportunity for greater access to this space to enable advisors to better serve their clients. Meanwhile, despite market volatility, 78% of advisors who currently have an allocation in client accounts plan to maintain or increase that exposure in 2023.

Despite the volatility in crypto markets over the past year, interest from investors and advisors remains at an all-time high, said Matt Hougan, chief investment officer at Bitwise Asset Management. While much of the data points to a maturing of the industry and how advisors and investors access education and information, only a small portion of advisors attribute this exposure on behalf of their clients, a gap obvious that demonstrates a key opportunity for advisors to provide better management of their clients’ investments.

For advisors accustomed to using ETFs to meet client needs, crypto allocation remains a challenge. There are a handful of bitcoin ETFs based on futures contracts, as well as funds connected to the crypto market through stocks; those funds have rebounded to start 2022. But advisors can’t invest in U.S.-listed spot bitcoin ETFs because the SEC has repeatedly blocked approval for such a product. While asset managers like Bitwise and Grayscale continue to push for a spot bitcoin ETF, the SEC remains concerned about potential fraud and manipulation.

After a difficult year for crypto in 2022, there has already been a surge in interest in crypto in 2023, explained Roxanna Islam, Associate Research Director at VettaFi. With signs of moderating inflation and hints of a less aggressive Fed, investors are poised to invest in higher-risk growth and tech-related stocks, especially with the rebound in tech prices. cryptography after the FTX crash. Five of the ten best performing ETFs year-to-date are crypto-related ETFs.

Advisors and their end clients continue to want to learn more about crypto investments despite the volatility incurred in 2022. For those focused on the long term, interest remains high.

VettaFi is hosting a webcast on Friday, January 27 at 2:00 p.m. ET to share more results from the advisor survey and to provide additional education on cryptocurrency investing. You can register for the event and, when you attend, receive continuing education credits. I hope to see you there.

For more news, insights and analysis, visit the Crypto Channel.

[ad_2]