📣 Investment Advisors Cautious About Recommending Bitcoin ETFs
posted 17 Jun 2024
BlackRock’s chief investment officer of ETF, Samara Cohen, points out that spot Bitcoin ETFs are progressing slowly due to financial advisors' initial exploration of this investment product. According to the firm, about 80% of all current purchases come from individual investors.
They usually tend to invest independently without additional consultations through standard online brokerage accounts. Hedge funds and brokerage firms also contribute investments, yet most investment advisors remain cautious and largely on the sidelines.
An investment advisor is a fiduciary to their clients. This is an asset class that has had 90% price volatility at times in history, and their job is really to construct portfolios and do the risk analysis and due diligence. They’re doing that right now,Cohen emphasized.
A CNBC Advisory Council survey identified major concerns including high volatility, Bitcoin's relatively short track record, uncertain regulatory landscape, and the cryptocurrency's association with high-profile scandals and fraud schemes such as drug trafficking and money laundering.
It's worth noting that BlackRock manages its own iShares Bitcoin Trust (IBIT), which is the market leader among U.S. spot Bitcoin ETFs, holding a market capitalization of approximately $20 billion. This accounts for nearly 40% of the total assets in the U.S. spot Bitcoin ETF market.
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