Money managers may need to rethink their approach to digital assets, with over a third of young, wealthy investors in a recent US survey indicating they had moved on from advisers who don’t offer crypto exposure.
Crypto payments provider Zerohash’s survey of 500 US investors aged 18 to 40, released on Wednesday, found that 35% had moved money away from advisers who didn’t offer access to crypto.
Those surveyed had incomes between $100,000 and $1 million, and more than half of those who moved money due to an adviser's lack of crypto offerings said they had moved between $250,000 and $1 million.
Crypto has only recently enjoyed an ultra-friendly policy environment in the US, and some wealth advisers are still playing catch-up as younger investors are less risk-averse compared to past generations.
Zerohash said that over four-fifths of those surveyed said their confidence in crypto was boosted due to its adoption by major finance institutions such as BlackRock, Fidelity and Morgan Stanley.
Crypto Holdings Are Prevalent and Set to Grow
Zerohash found that respondents with incomes of $500,000 and up were “leading the exodus,” with half having moved from advisers over crypto access.
The survey also found 84% of all respondents planned to increase their crypto holdings in the next year, with nearly half saying they would “increase their allocations significantly.”
Advisers Risk Falling Behind
Zerohash said the findings show that crypto “has become essential to modern portfolio strategy” and many wealthy investors “are not waiting for their private wealth managers to catch up.”
“Advisers who adapt early can strengthen client loyalty and capture new growth, while those who delay risk falling behind,” they said.
They added that investors were clear with their expectations and wanted “insured, compliant crypto access.”
Zerohash said based on its survey results, its playbook for advisers to win investors is to offer crypto on “the same dashboard as traditional assets” with insured custody.
“Investors expect more than Bitcoin and Ethereum,” it added. “Ninety-two percent say access to a broader range of digital assets is important.”
Meanwhile, asset managers have begun offering exchange-traded products with exposure to a wide range of cryptocurrencies, with products tied to altcoins including Solana (SOL), XRP (XRP) and Dogecoin (DOGE).
More novel products have featured staking, which rewards users for locking up tokens to secure a blockchain. Major issuer BlackRock is also seemingly set to offer staking exposure, with a filing for a staked Ether (ETH) exchange-traded fund in Delaware on Wednesday.