Nasdaq Survey: Spot Crypto ETF Would Speed Adviser Allocation

Nearly three-quarters of advisers would be more likely to invest in the space if a spot ETF were offered in the US

article-image

Blockworks exclusive art by axel rangel

share

key takeaways

  • While 86% of financial pros plan to boost their crypto allocations in the next year, none plan to decrease
  • Advisers, on average, report wanting to allocate 6% of a client’s total portfolio to crypto

Nearly nine of 10 financial advisers investing in crypto expect to increase their allocations over the next year, according to a Nasdaq survey, though the approval of a spot crypto ETF would help speed further adoption.

The survey published Monday gathered input from 500 advisers who are currently or considering allocating to crypto. While 86% plan to boost their allocations to the space in the next 12 months, none plan to decrease over that span.

“This is significant because it shows that neither advisers nor their clients are feeling buyer’s remorse as a result of their decisions,” Jake Rapaport, Nasdaq’s head of digital asset index research, told Blockworks.

But 72% of advisers would be more likely to invest client assets in crypto if a spot ETF were offered in the United States, the survey found.

The Securities and Exchange Commission has not yet approved a product that invests directly in cryptocurrencies, such as bitcoin, and 31% of respondents said they find it unlikely that such a product will be approved this year.

Bloomberg Intelligence analysts have said they do not expect a spot bitcoin ETF to be approved until mid-2023.

In the meantime, fund groups ProShares, Valkyrie Investments and VanEck last year launched ETFs that primarily invest in bitcoin futures contracts. The SEC last week approved a bitcoin futures ETF from asset manager Teucrium filed under the Securities Act of 1933 — the regulation under which spot bitcoin ETFs are filed.

Half of the advisers already investing in crypto are allocating to bitcoin futures ETFs, and 28% plan to start using them in the next 12 months, Nasdaq discovered.

Who is allocating, and how?

About a third of registered investment advisers (RIAs) use crypto, compared to 19% of independent broker-dealers (IBDs) and 17% of wirehouse advisers.

Advisers, on average, report wanting to allocate 6% of a client’s total portfolio to crypto.

Roughly 70% would consider using an index fund for broad exposure, followed by sector-specific index funds (57%), actively managed funds (52%), individual digital assets (40%) and high-yield funds (31%).

Despite this, only 10% of advisers say they are very knowledgeable about crypto. Nasdaq partnered with asset manager Hashdex last month to launch a digital assets curriculum for financial professionals.

“There is so much room for educational growth on the subject,” Rapaport said, noting that asset managers, index providers and media publishers can all help narrow the gap. “What’s less surprising is that advisers know what they want, and they largely want access to passive investment products for their clients’ portfolios.”

Nasdaq launched its crypto index in February 2021. It allocated roughly 67% to bitcoin and nearly 30% to ether, as of March 1, as well as allocations of less than 1% to eight other cryptoassets. 

“We continue to believe that the Nasdaq Crypto Index simplifies access to the entire asset class by adhering to principles that matter to advisers and investors,” Rapaport said. “We look forward to driving further innovation in crypto to support all types of investors.”


Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.


Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.


Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


Tags

upcoming event

MON - WED, MARCH 18 - 20, 2024

Digital Asset Summit (DAS) is returning March 2024. This year’s event will be held in our nation’s capital, where industry leaders, policymakers, and institutional experts will come together to discuss the latest developments and challenges in the ever-evolving world of cryptocurrency. […]

upcoming event

MON - WED, SEPT. 11 - 13, 2023

2022 was a meme.Skeptics danced, believers believed.Eventually, newcomers turned away, drained of liquidity and hope.Now, the tide is shifting and it’s time to rebuild. Permissionless II is the brainchild of Blockworks and Bankless. It’s not just a conference, but a call […]

recent research

Sequencers: The Key to The Rollup Investment Thesis

Research

Sequencers are one of the most explicit mechanisms in crypto for creating sustainable DAO-controlled revenue.

/

article-image

Yup’s Kabessa says “Twitter is our core competitor, rather than each other”

article-image

The Mantle testnet has been live since January and mainnet launch is estimated to occur sometime in July

article-image

Impending developments might “totally change” how Cosmos is experienced and perceived by the “broader crypto world”

article-image

Lawmakers set an optimistic tone on Wednesday, discussing room for crypto innovation in the supply chain, healthcare and national security

article-image

Binance faces 13 alleged US legal violations, while Coinbase faces just four

article-image

The SEC has seven days to respond to a court’s request for clarity on Coinbase’s lawsuit against the regulator