The Vast Majority of Financial Advisor Clients Asked About Cryptocurrencies in 2024 – Bitwise

A Latest report by Bitwise VettaFi reveals that 56% of financial advisors are likely to invest in cryptocurrencies this year, with the 2024 US election results weighing on sentiment.

The surge in cryptocurrency prices in 2024 and increased regulatory clarity has sparked greater interest from clients and advisors alike. In 2024, 96% of advisors sent clients inquiries about cryptocurrencies, the highest level on record, up from 88% in 2023.

In addition, the proportion of advisors allocating cryptocurrencies in client portfolios doubled year over year, rising to 22% in 2024, compared to 11% in 2023. Institutional investors (30%) and registered investment advisors (RIAs) (28%) were ) are the most likely to allocate to cryptocurrencies, followed by representatives of telecommunications companies (24%).

Advisor clients are also taking increasingly independent positions in cryptocurrencies, with 71% investing in cryptocurrencies independently of their advisors in 2024, up from 59% in 2023. These “held” assets represent a growing opportunity for advisors looking to integrate currencies Encrypted in broader wealth plans.

The report surveyed 430 qualified responses from financial advisors.

The report paints a picture of an industry gaining momentum. Advisors who have not yet allocated to cryptocurrencies increasingly tend to do so, with 19% planning to invest in 2025, up from 8% last year.

Meanwhile, 99% of advisors are already investing in cryptocurrencies to maintain or increase their exposure.

Political momentum

The 2024 US elections represent an important turning point for cryptocurrencies. President-elect Donald Trump Embracing digital assets, including the Bitcoin strategy (BitcoinThe reserve proposal fueled optimism.

Additionally, pro-crypto candidates have scored key victories in Congress, tilting the political landscape in the industry’s favor.

The report also highlighted growing speculation about the senator Cynthia Loomis (R-WY) for the United States to buy 1 million Bitcoin over five years, with 45% of advisors believing this will happen.

The report notes that the potential US entry into the Bitcoin reserves race could lead to a global trend, with countries like Brazil and Poland already considering similar legislation.

remaining obstacles

Despite growing enthusiasm, challenges remain. Volatility (47%) and regulatory uncertainty (50%) remain the top barriers to advisor adoption. However, regulatory concerns have decreased compared to previous years, reflecting a more positive outlook under the incoming administration.

65% of advisors are still unable or unsure if they can allocate cryptocurrencies in client accounts, which remains a significant hurdle.

Encouragingly, advisors are increasingly confident in their ability to value crypto assets, with only 31% citing concerns about valuation in 2024, down from 42% in 2023. Concerns about custody are also declining, with fear of a hack down from 38% in 2022 to 24%. In 2024.

Transformation strategies

The report also highlighted changing preferences among cryptocurrency investment vehicle advisors. Cryptocurrency stock ETFs (25%) remain the most popular option, as they provide a familiar entry point for advisors hesitant about direct exposure to cryptocurrencies.

Interest in spot cryptocurrency ETFs (22%) and diversified cryptocurrency index funds (19%) has risen, reflecting the growing appeal of professionally managed options.

The report noted that advisors are exploring more complex strategies, with thematic strategies (26%) and buffer strategies (24%) receiving significant interest. These methods aim to smooth out the volatility of cryptocurrencies and achieve differentiated returns.

She added that 67% believe the price of Bitcoin will rise over the next year, up from 52% in 2023. By 2030, 40% expect Bitcoin to trade between $250,000 and $1 million, with 10% expecting it to exceed $1 million.

The report also noted that there is growing conviction in Bitcoin’s long-term potential as a major asset. 83% of survey respondents believe that Bitcoin will have a higher market value than Ethereum (Ethereum) within five years.

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