Financial advisors are still reluctant to use cryptocurrencies. Investor demand may change that

Financial advisors are still reluctant to use cryptocurrencies. Investor demand may change that

Financial advisors have been reluctant to integrate cryptocurrency into client portfolios. They likely won't be able to ignore the alternative asset for much longer. Cerulli Associates, in a study, found that 45% of advisors say they expect to use cryptocurrencies in the future in response to client requests. Meanwhile, just 7% of advisors say they are currently using these assets based on their own recommendations, and 10% are using it because of client requests. Investors are curious about exposure to these assets, with 80% of advisors saying clients of all ages have asked them about cryptocurrencies, according to Cerulli. In comparison, a June 2021 survey from the Financial Planning Association and the Journal of Financial Planning found about 49% of advisors said clients had asked about cryptocurrencies in the preceding six months. One key reason for increased investor interest: The surge in value cryptocurrencies saw last year. Their market capitalization climbed to $3 trillion in 2021, before falling to around $2 trillion this year. The free float market capitalization, which represents the amount of cryptocurrencies available for trading in the market, is around $1.3 trillion. Bitcoin and ethereum comprise much of that. "If advisors aren't including it or at least