Wall Street opens the door! Bank of America advisors proactively recommend Bitcoin ETFs, suggesting a 1%~4% allocation

U.S. Banks Adjust Wealth Management Policies to Actively Recommend Bitcoin Spot ETFs and Suggest Allocations of 1%–4%, Signaling Wall Street’s Official Inclusion of Bitcoin into Standard Investment Discussions.

Shift in Advisor Role: Bank of America Officially Incorporates Bitcoin into Standard Investment Conversations

Bank of America has officially revised its wealth management policies to allow its advisors to proactively recommend Bitcoin spot ETFs to clients and suggest allocating approximately 1%–4% of investment portfolios to digital assets when appropriate.

According to internal documents and management statements cited by multiple foreign media outlets, this new guideline has been in effect since January 5 and applies to Bank of America Private Bank, Merrill, and Merrill Edge, covering over 15,000 financial advisors.

Previously, Bank of America’s stance on crypto assets was relatively conservative, with advisors mostly providing information only upon client inquiry, following a “passive response” model. This policy change signifies that Bitcoin ETFs are no longer considered exceptional assets but are now standard options that can be included in general investment portfolio discussions.

Chris Hyzy, Chief Investment Officer at Bank of America, pointed out that for investors who can tolerate higher volatility and are interested in innovative themes, a small allocation to digital assets may help improve the overall risk-return profile of their investment portfolios.

Approval of Four Bitcoin Spot ETFs to Avoid Self-Custody Risks

In practical terms, Bank of America has chosen to use Bitcoin spot ETFs as the only compliant channel rather than directly holding Bitcoin. The bank’s Chief Investment Office has approved four products listed in the U.S., which are among the largest in scale and liquidity, including Bitcoin ETFs from Bitwise, Fidelity, Grayscale, and BlackRock. This move reflects a pragmatic approach by major financial institutions considering risk management and regulatory compliance.

Compared to direct coin holdings, ETF structures can avoid private key custody, cybersecurity risks, and operational errors, while seamlessly integrating with existing investment reporting, rebalancing, and compliance processes. Market participants note that these products are more aligned with traditional investors’ operational familiarity, helping to lower psychological barriers. Bank of America also emphasizes that, despite a relatively relaxed regulatory environment, the crypto market remains highly volatile, with prices potentially deviating significantly from fundamentals due to sentiment and speculative activities.

Logic and Limitations Behind the 1%–4% Allocation

The suggested 1%–4% allocation from Bank of America is not universally applicable but is based on assessments of clients’ risk tolerance, investment objectives, and regulatory suitability. Internal research indicates that a small allocation can help generate returns with low correlation to traditional assets without significantly increasing overall risk. However, Bank of America also clearly reminds that the long-term value of digital assets remains uncertain, with market cycles being highly volatile, and short-term prices potentially heavily influenced by policy signals and market sentiment.

It is worth noting that the current approved list only includes Bitcoin-related products and has not yet extended to Ethereum or other digital asset ETFs. The general consensus is that future expansion will depend on market liquidity maturity, product transparency, and whether institutional-grade trading and risk control capabilities are in place. For Bank of America, Bitcoin remains the most widely accepted and infrastructure-ready single asset.

Wall Street’s Attitude Shift: Institutional Capital Entry Barriers Lowered Again

This move by Bank of America is seen as a significant milestone indicating a shift in Wall Street’s attitude toward Bitcoin. Recently, regulatory attitudes toward banks holding certain crypto assets have relaxed, and other major banks and financial institutions are increasingly deploying custody and trading services for crypto, paving the way for institutional capital to enter. Against this backdrop, including Bitcoin ETFs in advisor recommendation lists not only influences their own clients but may also set a precedent for the overall market narrative.

Overall, this does not mean that Bitcoin has been fully “de-risked” by the mainstream financial system but rather that it is being repositioned as a controllable, quantifiable risk asset class. For traditional investors, such institutionalized access is gradually changing the perception of crypto assets from “marginal speculative tools” to a more integrated asset class suitable for long-term investment discussions.