Bank of America backs 1–4% crypto allocation, opens door to Bitcoin ETFs

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More big-name fiscal institutions are opening the doorway to Bitcoin exposure, signaling a increasing organization appetite for regulated integer plus products.

Bank of America, the second-largest US bank, has reportedly recommended a 1–4% cryptocurrency allocation to its wealthiness absorption clients done the Merrill, Bank of America Private Bank and Merrill Edge platforms, according to a connection shared with Yahoo Finance connected Tuesday.

“For investors with a beardown involvement successful thematic innovation and comfortableness with elevated volatility, a humble allocation of 1% to 4% successful integer assets could beryllium appropriate,” said Chris Hyzy, main concern serviceman astatine Bank of America Private Bank, successful the connection shared with Yahoo.

Starting Jan. 5, the slope volition alteration its clients to summation entree to 4 caller Bitcoin (BTC) exchange-traded funds (ETFs), including the Bitwise Bitcoin ETF (BITB), Fidelity’s Wise Origin Bitcoin Fund (FBTC), Grayscale’s Bitcoin Mini Trust (BTC) and BlackRock’s iShares Bitcoin Trust (IBIT).

The improvement volition alteration the bank’s wealthiest clients to summation vulnerability to Bitcoin ETFs for the archetypal time, which were lone disposable upon request. Previously, the bank’s implicit 15,000 wealthiness advisers were incapable to urge immoderate cryptocurrency concern products.

“Our guidance emphasizes regulated vehicles, thoughtful allocation, and a wide knowing of some the opportunities and risks,” added the bank’s main concern officer.

The bank’s Bitcoin allocation proposal is signaling a wider organization appetite for regulated cryptocurrency concern products. It comes a time aft Vanguard, the world’s second-largest plus manager, enabled crypto ETF trading for its clients, reversing its erstwhile stance connected integer plus ETFs.

Cointelegraph has contacted Bank of America for much details connected its crypto allocation recommendations.

Bank of America is the second-largest slope successful the US with astir $2.67 trillion successful consolidated assets and implicit 3,600 branches, according to Forbes.

BlackRock helped acceptable the Bitcoin allocation playbook

BlackRock, the world’s largest plus absorption firm, was the archetypal ample instauration to urge an up to 2% Bitcoin allocation to its clients, Cointelegraph reported successful December 2024.

Around 1–2% is simply a “reasonable scope for Bitcoin exposure,” which poses the “same stock of wide portfolio risk” arsenic a emblematic allocation to “the ‘magnificent 7’ radical of mostly mega-cap tech stocks,” wrote BlackRock successful a study astatine the time.

The “magnificent 7” refers to Amazon, Apple, Microsoft, Alphabet, Tesla, Meta and Nvidia.

In June, plus absorption steadfast Fidelity besides recommended a 2% to 5% Bitcoin allocation, which was tiny capable to minimize the hazard of a Bitcoin crash, but ample capable to bask immoderate upside from BTC’s inflationary hedge.

Earlier successful October, Morgan Stanley also suggested a 2% to 4% allocation to crypto portfolios for investors and fiscal advisers, further signaling that ample fiscal institutions are moving toward a shared playbook of modest, risk-managed vulnerability to integer assets.