Some independent financial advisors rely on what are known as turnkey asset management programs, or TAMPs, to manage portfolios of traditional assets such as stocks and bonds. Now they’ll be able to do the same for clients who want to invest in cryptocurrencies such as Bitcoin and Ether.
San Francisco-based Blockchange said this week it was rolling out Bitria, a digital-asset TAMP for RIA firms.
Bitria allows advisors to actively manage crypto across their entire client base or just within individual client portfolios, the company said. It provides automatic rebalancing and gives advisors’ clients access to a portal where they can monitor and research their digital holdings.
“Many RIAs are looking to go beyond the mundane stock and bonds portfolio and really strive to give their clients the level of diversification and investment the market has to offer, but until now there hasn’t been a way to participate other than through index funds or hedge funds,” said Dan Eyre, CEO of Blockchange, which was founded in 2017.
Of course, cryptocurrencies are notoriously volatile. Bitcoin has seesawed wildly over the past year, with a low of about $5,000 and a high near $12,000, according to Coindesk.
Advocates have touted cryptocurrencies for lacking correlation with traditional asset classes, although Bitcoin and stocks plummeted together in late February and early March as coronavirus fears rattled investors around the world.
Top advisor Ric Edelman has encouraged fellow wealth managers to understand the emerging asset class and has said allocating a small portion of a portfolio—say 1%—to Bitcoin can’t hurt.