One in Three Indy RIAs to Offer Crypto Services

We’re living in a digital world, so we better get used to it.

Crypto and digital asset management is relatively uncommon among financial advisors, with less than 20% of independent RIAs currently providing the service. That could soon change, however. Roughly a third of independent RIAs said they expect to offer crypto and digital asset services within the next three years, according to Charles Schwab’s latest advisor outlook study. 

It’s a figure that marks a continuing shift toward crypto among investors. Whether it’s something advisors are looking forward to doesn’t necessarily matter because it’s what some clients are demanding.

“While advisors themselves may not be a big believer of [crypto], many of their clients have it housed elsewhere,” Jalina Kerr, head of advisor experience at Schwab, said during a media roundtable at the Schwab Impact conference last week. “[Clients] want to actually be able to bring it to their Schwab portfolios, so they can see it all in one place.”

Client Gets What the Client Wants

Advisors’ plans to add digital asset management to their practices line up with client interest in crypto:

• Currently, 28% of clients say they are interested in crypto offerings, and the majority of that enthusiasm is for established currencies like bitcoin and ethereum, the study found.
• Meanwhile, 13% said they are unsure if they want to hold crypto, and the rest aren’t interested at all.
• The biggest pain point right now for advisors is oversight. Two-thirds of independent RIAs said they are looking for clearer and easier-to-understand regulation before engaging further with crypto. 

“Advisors are always a risk-averse group, and they’re going to probably walk before they run, but they are very aware that they need to step into that space with some knowledge and expertise,” Kerr said.

Next Gen Clientele. Advisors are also preparing for the next generation of clients, said David Botset, head of strategy, innovation and stewardship at Schwab. He said an advisor approached him at the conference and asked when he could start custodying crypto with Schwab. “This advisor is thinking about the wealth transfer,” Botset said. “That younger generation has a lot more interest [in crypto].”