Financial advisors bought crypto for themselves in 2021 at nearly double the rate of the previous year, and Financial Advisor Magazine turned to Daren Blonski, our co-founder and managing principal, for perspective on why. For the article "Advisor Interest And Investments In Crypto Are Soaring, New Study Finds", reporter Tracey Longo covers new survey data from Bitwise Asset Management showing 47% of advisors now hold crypto personally, up from 24% the year before, with client demand and portfolio allocations climbing right along with it. Daren has been investing in Bitcoin since 2016, and he's not surprised by the numbers. "In client portfolios we keep a very measured position," he says. "When you've got market volatility like we've seen, we use the opportunity to rebalance just like we would with any other asset class. We don't say 'the market sold off, we're going to get rid of Bitcoin.'" His attraction to the asset comes down to what backs it: a hard cap of 21 million coins, no ability to mine more, and a design that lets investors transact directly without a centralized exchange. "It's the decentralization that makes Bitcoin what it is," Daren says, pointing to how quickly the asset has moved into the political mainstream. "Overnight Sen. Ted Cruz became an expert in Bitcoin because his power base, the energy infrastructure, is using it. You also have gobs of millionaires and billionaires putting together PACs to protect Bitcoin."
Key Takeaways
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Advisor and client interest in crypto is compounding fast: 47% of advisors now hold it personally, up from 24% a year ago, and 94% are fielding client questions about it.
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Bitwise's own data suggests advisor allocations to Bitcoin in client accounts could climb from 15% today to nearly 30% by year-end.
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Rebalancing, not panic-selling, is the right response to Bitcoin's volatility within a diversified portfolio.
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Bitcoin's fixed 21-million-coin supply and decentralized structure are the core reasons Daren finds it attractive as an asset class.
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Bitcoin's move into mainstream politics and energy infrastructure, from Senator Ted Cruz to oil-producing regions mining it directly, signals it is no longer a fringe asset.
Deciding how much crypto exposure, if any, belongs in a portfolio is exactly the kind of conversation we have with clients every day. Learn more about our Investment Management services.