Why It Pays for Advisors To Become Crypto-Proficient

Bitcoin and other cryptocurrencies have been generating increased buzz among both advisors and clients following the debut of spot bitcoin exchange traded funds last month.

A major event in crypto and ETF history to be sure and the reason for that status is simple. One of the primary reasons for the hype surrounding the approval of spot bitcoin ETFs is that thanks to the ETF wrapper, bitcoin is now more accessible and convenient for advisors to access, meaning the digital asset could eventually reside in more client portfolios.

Let’s be honest. While bitcoin or any other cryptocurrency for that matter shouldn’t account for an excessive percentage of any client’s portfolio (it should be a modest percentage), the fact is crypto as a legitimate alternative asset is increasingly relevant and ETFs are making that transition.

For advisors that need more convincing, consider this. Data suggest that female clients are increasingly interested in crypto. Translation: advisors looking to better connect with women can leverage crypto as a one possible starting point.

ETFs Could Bring More Women Into Crypto Investing

It remains to be seen if spot bitcoin ETFs are the impetus for more women investing in that digital currency, but an interesting scenario emerged last month. According to Stocklytics.com, the number of women investing in crypto jumped 61% in January, the month in which spot bitcoin ETFs debuted.

“While the males are in the lead for most crypto asset ownership, the female crypto adoption is growing incessantly, highlighting the versatility and pull crypto assets have. In a world where financial independence is valued and emphasized, women are approaching crypto for personal wealth creation to savor their financial freedom,” according to the research firm.

Interestingly, the budding enthusiasm for crypto among women isn’t confined to bitcoin. That’s one point for advisors to note. Another is why women are interested in the asset class. A big reason is that they view it as an avenue to reaching financial independence.

“Globally, 63% (of women) are looking to add their crypto assets in Bitcoin, Ethereum, Cardano, and dogecoin over the next year, with females contributing significantly to the count. Most women are re-envisioning crypto as a potential long-term investment, especially with the prices expected to soar. About 56% of crypto owners have a positive outlook on the prices and expect them to augment,” adds Stocklytics.

Women Are Putting Money Into Crypto

Women aren’t just thinking about crypto. They’re putting capital to work in the asset class. Last year, just 18% of women had embraced digital currencies in some form, but figure is expected to surge to 29% this year.

A skeptical advisor might be inclined to say that fewer than three in 10 of any group being interest in a particular investment is nice, but it’s not a huge percentage. While that’s correct, it misses the mark about capitalizing on crypto as way to enhance relationships with female clients.

“However, women are showing considerable interest in crypto even as their adoption rate spikes outshadowing men’s. In 2023, 43% of men in the US had crypto, while only 18% of women held the asset. Today, we’re looking at a 48% male adoption and a 29% female adoption in the US. This represents a remarkable 61% surge in female adoption in just a few weeks into 2024,” concludes Stocklytics.

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