# Bank of America Backs 1%–4% Crypto Allocation for Wealth Clients

*Bank of America has endorsed a 1%–4% crypto allocation for its wealth management clients, using Bitcoin ETFs and other regulated products. The move places one of the largest US banks inside the digital asset allocation debate, after years of hesitation.*

**Author:** Bartek
**Published:** 2025-12-02 13:47:00
**Source:** [View on Coinpaprika](/news/bank-of-america-backs-1-4-crypto-allocation-wealth-clients/)

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## Bank of America Issues Formal Crypto Allocation Guidance


Bank of America now advises its wealth management clients to allocate **1%–4%** of portfolios to crypto and digital assets. The recommendation covers **Merrill Lynch**, **Bank of America Private Bank**, and **Merrill Edge** platforms. Beginning January 5, 2026, the bank's Chief Investment Officer (CIO) team will provide coverage on four Bitcoin exchange-traded funds (ETFs), enabling over **15,000 wealth advisors** to recommend regulated crypto products for the first time.


For investors with strong interest in thematic innovation and elevated volatility, a modest allocation of 1% to 4% in digital assets could be appropriate. The core of our recommendation lies in choosing regulated instruments, making prudent allocations, and clearly understanding the associated opportunities and risks.— Chris Hyzy, Chief Investment Officer, Bank of America Private Bank
## Scale and Conservative Positioning


Bank of America manages over **$3 trillion** in client assets across its wealth divisions. The **1% floor** targets conservative investors seeking minimal exposure, while the **4% ceiling** serves as a maximum for risk-tolerant clients. This range mirrors guidance from **Morgan Stanley** (2%–4%) and **BlackRock** (1%–2%), positioning BofA in the mainstream of major financial institutions. The bank will cover ETFs including Bitwise Bitcoin ETF (BITB), Fidelity Bitcoin ETF (FBTC), Grayscale Bitcoin Mini Trust (BTC), and iShares Bitcoin Trust (IBIT).


## Regulated Implementation Through ETF Coverage


The guidance explicitly requires **regulated instruments** only, avoiding direct custody of digital assets. This approach complies with existing securities regulations while meeting rising client demand. Nancy Fahmy, head of Bank of America's investment solutions group, stated the policy update reflects growing demand for digital asset access. The bank's strategists will provide research and risk analysis to support advisor recommendations, treating crypto as a **satellite risk asset** rather than a core portfolio component.


## Market Context Amid Retail Dominance and Policy Shifts


The recommendation arrives as **retail investors** hold approximately **75% of Bitcoin ETF assets**, making them vulnerable to volatility. Bitcoin has fallen roughly **33% from its $126,000 peak** in early October, while the S&P 500 has gained over 15% year-to-date. The Trump administration's policy shift in 2025 removed Biden-era restrictions on bank crypto activities, accelerating institutional adoption.

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**Tags:** Banking, Digital Assets

