Financial advisors play a pivotal role in the adoption and allocation of emerging asset classes like cryptocurrency. In the United States alone, they oversee more than $20 trillion in assets—roughly half of the nation’s total wealth—and serve as critical educators for both individual and institutional clients.
Bitwise and VettaFi’s annual survey offers valuable insights into how financial advisors perceive and engage with cryptocurrency. Now in its fifth year, the study reveals evolving trends in adoption, client interest, and the overall sentiment shaping crypto’s place in investment portfolios.
So, what do advisors really think about crypto today? Despite market volatility, many remain optimistic about its long-term potential. Both advisors and their clients continue to show strong interest, with allocations hovering near all-time highs. That said, barriers like limited access, regulatory uncertainty, and volatility continue to pose challenges.
Here are six key takeaways from the latest Bitwise/VettaFi 2023 Survey on financial advisor attitudes toward crypto assets.
1. Crypto Allocations Remain Stable Despite Market Volatility
Despite the turbulence of the past year, the proportion of advisors allocating to cryptocurrency in client accounts remained notably stable. In 2022, 15% of advisors reported allocating to crypto, nearly matching the previous year’s 16% and significantly exceeding the 2021 (9%) and 2020 (6%) figures.
One major factor limiting broader adoption is accessibility. Only 29% of advisors say they have the ability to buy crypto in client accounts. However, among those who do have access, more than half (52%) are currently making allocations—highlighting the crucial link between access and action.
2. Advisors Who Invest Tend to Stay Invested
There’s a clear divide between advisors who have already allocated to crypto and those who have not. Among those who haven’t yet invested, 74% either don’t plan to increase exposure in 2023 or are still evaluating the option.
On the other hand, 78% of advisors who are already allocating to crypto plan to either maintain or increase their exposure. This suggests that firsthand experience helps build comfort with the asset class, while those on the sidelines may have been deterred by the 2022 crypto downturn.
3. Client Interest Remains Strong
Advisors continue to field strong client interest in cryptocurrency. Last year, 90% of advisors received questions from clients about crypto—down slightly from 94% in 2021, but still well above the 81% reported in 2020 and 76% in 2019.
When asked which question they heard most from clients, more than half (56%) of advisors selected: “Should I consider investing in cryptocurrency?”
4. Many Clients Invest on Their Own
According to survey respondents, 59% of clients invested in crypto outside of their advisory relationships in 2022—down from 68% the previous year.
Among those who self-invest, 75% used centralized crypto exchanges like Coinbase, while 41% invested directly through their own crypto wallets. Only 18% gained exposure through self-directed brokerage accounts, indicating a preference for crypto-native platforms.
5. Short-Term Caution, Long-Term Optimism
Bitcoin, as the largest cryptocurrency by market cap, often serves as a barometer for market sentiment. Advisor outlook on Bitcoin reflects short-term caution but long-term confidence.
Only 37% of advisors believe Bitcoin’s price will be higher one year from now. However, 60% think it will be higher five years from now—suggesting that while near-term uncertainty persists, long-term conviction remains strong.
6. Regulatory Uncertainty and Volatility Are Top Concerns
The major pain points of 2022—corporate failures, high volatility, and regulatory ambiguity—continue to weigh on advisors’ minds.
Regulatory uncertainty remains the single biggest barrier to adoption, cited by 65% of advisors. That’s up from 60% in 2021, 52% in 2020, and 56% in 2019. On a positive note, fewer advisors in 2022 cited “lack of understanding” (25%) or “lack of confidence talking about crypto” (16%) as barriers—suggesting growing knowledge and comfort over time.
Current Challenges and Future Outlook
The survey results align with what many financial professionals have been hearing throughout 2022: although events like the FTX collapse and extreme market volatility raised concerns, advisors and clients continue to allocate to crypto, and interest remains robust.
That said, institutional investors are still grappling with the aftershocks of 2022. The bankruptcy of Genesis Global—one of the largest crypto lending platforms—further shook confidence, impacting firms like Gemini and drawing regulatory scrutiny from the SEC. Meanwhile, crypto-friendly banks such as Silvergate faced severe liquidity challenges, with clients withdrawing 68% of all deposits in Q4 alone.
Additional risks loom in 2023, including potential sell-pressure events such as the Mt. Gox bankruptcy resolution and Ethereum’s Shanghai upgrade, which will allow staked ETH to be withdrawn and sold. Concerns also persist around unregulated entities like Tether and Binance.
Against a backdrop of Fed rate hikes and ongoing recession fears, it’s clear that the crypto market still faces significant headwinds.
Yet, despite these challenges, many in the industry remain bullish on the long-term trajectory of cryptocurrency. Market progress is rarely linear, but growing adoption among advisors and investors suggests a foundation for future growth.
👉 Explore current crypto investment strategies
Frequently Asked Questions
How many financial advisors are investing in cryptocurrency?
Approximately 15% of financial advisors reported allocating to cryptocurrency in client accounts in 2022. This number has remained steady compared to the previous year and has grown significantly since 2020.
What is the biggest barrier for advisors entering the crypto market?
Regulatory uncertainty is the most commonly cited barrier, mentioned by 65% of advisors. Other concerns include volatility, lack of access, and—to a lesser extent—a lack of understanding or confidence.
Are clients interested in cryptocurrency?
Yes. 90% of advisors received questions about crypto from their clients in the past year. The most common question was whether clients should consider investing in it.
How are clients investing in crypto on their own?
The majority use centralized exchanges like Coinbase or hold crypto directly in personal wallets. A smaller percentage use traditional brokerage accounts to gain exposure.
Do advisors believe Bitcoin will rise in the future?
While only 37% of advisors expect Bitcoin’s price to increase in the next year, 60% believe it will be higher five years from now, indicating stronger long-term confidence.
What trends are shaping advisor sentiment in 2023?
Key trends include stable allocation levels, continued client interest, and a focus on regulatory developments. Advisors with existing exposure are more likely to maintain or increase their crypto allocations.