Matt Hougan reveals a surge in crypto interest among advisors, paving the way for future client investments despite regulatory challenges.
Financial advisors in the United States are increasingly showing interest in cryptocurrency, marking a significant shift in the financial landscape. According to Matt Hougan, the Chief Investment Officer (CIO) of Bitwise Asset Management, about 70% of top financial advisors now hold crypto assets in their personal portfolios. This is a substantial increase from just a few years ago when only 10-20% of advisors were involved in crypto.
At the Barron’s Advisor 100 Summit, Hougan highlighted that personal investments in cryptocurrency often precede client allocations. Advisors typically begin by investing personally, and client investments usually follow within 6 to 12 months. This trend suggests that as advisors become more comfortable with crypto, they are likely to recommend it to their clients.
Despite the growing personal interest among advisors, client adoption of cryptocurrency remains limited. This is primarily due to restrictions imposed by broker-dealers, which prevent clients from purchasing certain crypto assets, such as spot Bitcoin ETFs. These regulatory hurdles are a significant barrier to wider adoption among clients.
Hougan is optimistic about the future of cryptocurrency in the financial sector. He points out that the approval of Bitcoin ETFs and other positive developments in the crypto market are likely to enhance the financial infrastructure, making it easier for clients to invest. As these barriers are addressed, we can expect to see more client portfolios including crypto assets.
