The latest findings from Bitwise and VettaFi indicate a significant shift in sentiment among financial advisors towards cryptocurrencies. According to the report, 56% of advisors are now more inclined to invest in crypto, a trend largely influenced by the outcome of the 2024 US election.
The surge in crypto prices in 2024, coupled with increased regulatory clarity, has led to a surge in interest from both clients and advisors. The report reveals that 96% of advisors received inquiries from clients about crypto, marking the highest level on record. Furthermore, the proportion of advisors allocating crypto in client portfolios doubled from the previous year, with institutional investors and Registered Investment Advisors leading the way.
Interestingly, clients are also taking independent positions in crypto, with 71% investing in digital assets without the guidance of their advisors. This trend presents a growing opportunity for advisors to incorporate crypto into broader wealth management plans.
The report, based on responses from 430 financial advisors, indicates a growing momentum in the industry. A notable 19% of advisors who have not yet allocated crypto are planning to do so in 2025, up from 8% in the previous year. Additionally, 99% of advisors already investing in crypto plan to either maintain or increase their exposure to digital assets.
The political landscape has also played a significant role in shaping sentiment towards crypto. The report highlights President-elect Donald Trump’s positive stance on digital assets, including a proposal for a strategic Bitcoin reserve. Moreover, pro-crypto candidates securing key victories in Congress have further bolstered optimism within the industry.
Despite the growing enthusiasm, challenges such as volatility and regulatory uncertainty remain top concerns for advisors. However, regulatory concerns have decreased compared to previous years, indicating a more favorable outlook under the new administration. Advisors are also gaining confidence in valuing crypto assets and addressing custody concerns.
In terms of investment vehicles, crypto equity ETFs remain popular among advisors, offering a familiar entry point for those hesitant about direct exposure to cryptocurrencies. Interest in spot crypto ETFs and diversified crypto index funds has also surged, reflecting a growing appeal for professionally managed options.
Advisors are also exploring more sophisticated strategies to navigate crypto’s volatility and deliver differentiated returns. Thematic strategies and buffered strategies are gaining traction, with a majority of respondents expressing confidence in Bitcoin’s price potential over the next year and beyond.
Overall, the report underscores a growing conviction in crypto’s long-term potential as a mainstream asset, with Bitcoin expected to surpass Ethereum in market cap within five years. The findings paint a picture of an industry on the cusp of significant growth and evolution in the coming years.