Bank of America, one of the world’s largest financial institutions, is making a decisive shift toward crypto. According to Yahoo Finance, starting next year clients of Merrill, Bank of America Private Bank, and Merrill Edge will be able to allocate up to 4% of their portfolios to digital assets. It is the bank’s most significant move toward cryptocurrency adoption to date and another sign that traditional finance increasingly views digital assets as a legitimate investment category.

Conservative one percent, bold four

Chris Hyzy, Chief Investment Officer at Bank of America Private Bank, noted that appropriate exposure ranges from 1% to 4% depending on risk tolerance. The lower end suits conservative investors entering crypto or seeking to minimize volatility, while the upper end targets those willing to embrace technological innovation and higher risk.

Previously, clients could access crypto products only upon request, limiting more than 15,000 wealth managers who were prohibited from actively recommending them. The policy shift marks a substantial turn.

ETFs as the bridge between two worlds

Beginning January 5, Bank of America will provide coverage for bitcoin ETFs from Bitwise, Fidelity, Grayscale, and BlackRock. These funds have become a crucial tool for offering exposure to digital assets without requiring exchanges or crypto wallets. While the bank has not issued an official statement, internal platform changes suggest a strategic pivot.

Fidelity recommended higher allocations earlier

Bank of America is not the first major institution to issue concrete guidance on crypto exposure. Fidelity stated last year that investors should consider a 2%–5% allocation to Bitcoin, examining such strategies since 2020 as part of its research into Bitcoin as a distinct asset class.

Sources:

https://finance.yahoo.com/news/bank-of-america-says-its-wealth-management-clients-may-put-up-to-4-of-their-portfolio-in-crypto-220028738.html?guccounter=1&guce_referrer=aHR0cHM6Ly9kZWNyeXB0LmNvLw&guce_referrer_sig=AQAAAAcu-hucalih16qqeckbxNJAF6kjMY8-IynqW9pv_ZQbIeNA7k28KhlQX9Nvdyh_KzjIkJ5iPyTGKKE0SLtxdeAF6itUSSJxjRuResNUYOPpq-78yoZi5lV-ubuVb02Iub99Yu5PVQ_E4MhnNrTDxnbPzGbdfK7LksHu9xZOOrj1

https://decrypt.co/44880/bitcoin-should-be-5-percent-your-investment-portfolio-fidelity