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Portfolio > Alternative Investments > Cryptocurrencies

More Advisors Plan to Recommend Crypto: Survey

By Michael S. Fischer

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Thirty-five percent of financial advisors in a March survey released this week said they planned to recommend digital assets to their clients within the next six months, up from just 21% of advisors who said this in a December survey.

The new survey, conducted by Digital Assets Council of Financial Professionals and sponsored by Franklin Templeton Digital Assets, received responses from 272 financial professionals, 71% of whom work at independent RIAs, 19% at regional or independent brokerages and 2% at wirehouses or other types of financial services firms.

“The availability of new spot bitcoin ETFs, combined with a roughly 50% increase in bitcoin’s price so far this year, is spurring advisors to get more involved with crypto than ever,” DACFP founder Ric Edelman said in a statement. “Advisors are racing to gain the knowledge they need to properly serve their clients.”

Survey Findings

The March survey found that just 30% of respondents have asked their clients whether they own crypto. Of those, 92% said some of their clients have invested in crypto; only 8% reported that none of their clients did so. 

Furthermore, 39% of advisors reported that as many as half of clients own digital assets, and 10% said more than half their clients do.

Only 34% of advisors said they are actively recommending crypto to clients, down from 59% in the December survey. DACFP said anecdotal evidence suggests that this decline resulted from firms issuing updated guidance to advisors during their due diligence process of evaluating the new spot bitcoin ETFs.

Of respondents who said they are recommending crypto, 8% are recommending it to all their clients, a slight increase from December. Another 24% have recommended crypto to more than half of their clients, and 35% have recommended to less than 10%.

Overall, 87% of respondents said they are recommending that clients allocate 1% to 5% of their assets to crypto, with 31% settling a 2% recommended allocation. Another 8% of advisors recommend allocations of 10% to 14%, and 1% are recommending allocating more than 20%.

“Advisors increasingly express interest in allocating towards digital assets as a means of better diversifying their clients’ portfolios and capturing the investment opportunity represented by the growing protocol-based network economy,” Sandy Kaul, head of digital asset and industry advisory services at Franklin Templeton, said in the statement.

Of the advisors who have not yet allocated to crypto but said they intend to do so, 28% said they planned to allocate 5% of assets in client portfolios.

Michael S. Fischer

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