Bank of America is urging its wealth management clients to consider placing a small but deliberate slice of their portfolios into digital assets.
The bank now recommends a 1% to 4% crypto allocation, marking a significant shift in how one of the country’s largest financial institutions approaches Bitcoin exposure.
The guidance applies across Merrill, Bank of America Private Bank, and Merrill Edge, according to a Yahoo Finance report.
It also unlocks crypto recommendations for more than 15,000 advisers who were previously restricted from initiating conversations about digital assets unless a client asked for it directly.
The change takes effect Jan. 5, when the bank’s chief investment office begins formal research coverage of four bitcoin ETFs. Those funds include Bitwise’s BITB, Fidelity’s FBTC, Grayscale’s Bitcoin Mini Trust, and BlackRock’s IBIT.
Chris Hyzy, chief investment officer for Bank of America Private Bank, said the bank is taking a measured approach. A small allocation may suit investors seeking exposure to thematic innovation, he said, but only through regulated products. He also emphasized the need for clear expectations about volatility.
The bank said the lower end of the 1% to 4% range may better fit conservative clients, while the higher end may appeal to those with stronger risk tolerance.
Bitcoin is getting more and more appealing to wealthy investors
The policy change reflects rising interest in Bitcoin from wealthy clients. Nancy Fahmy, head of the bank’s investment solutions group, said demand has grown noticeably over the past year. Many clients previously turned to platforms outside the bank to gain exposure to Bitcoin ETFs.
The shift puts Bank of America in line with peers that have already integrated Bitcoin exposure into their wealth strategies. Morgan Stanley recommended a 2% to 4% allocation for suitable clients in October, describing Bitcoin as “digital gold” and crypto as a speculative but maturing asset class.
The firm also encouraged ETF-based exposure with disciplined rebalancing.
BlackRock, the world’s largest asset manager, has argued that a 1% to 2% allocation can improve long-term portfolio efficiency. Fidelity has long maintained a broader 2% to 5% range, with higher suggested allocations for younger investors.
Meanwhile, distribution channels continue to open. Bloomberg reported Monday that Vanguard — long resistant to offering any Bitcoin-linked products — will allow select crypto ETFs and mutual funds on its platform starting today. That move follows earlier approvals from Morgan Stanley, Charles Schwab, Fidelity, and JPMorgan Chase.
The institutional shift comes during a volatile period for Bitcoin. The asset has fallen roughly 10% over the past year after retracing from record highs above $126,000 reached in October. Still, major banks maintain bullish long-term views.
JPMorgan recently set a $170,000 price target, while Standard Chartered reiterated its call for Bitcoin to approach $200,000.
At the time of writing, bitcoin is trading at $89,046.
