Bank of America Opens Door to Bitcoin Advisory Services for Wealth Clients

Bank of America has authorized its wealth management advisors to recommend bitcoin investments to eligible clients. The policy will take effect in January 2026 and applies across Merrill Lynch and the Private Bank division.

Advisors can now recommend allocations ranging from 1% to 4% of client portfolios to digital assets. This represents a significant departure from the bank's previous stance, which prohibited advisors from initiating or recommending cryptocurrency exposure.

The institution previously allowed clients to purchase crypto products independently through brokerage accounts. However, advisors faced strict restrictions against actively recommending these investments. That prohibition has now been lifted.

Four Approved Bitcoin ETFs Enter Advisory Framework

The new guidelines direct advisors toward four specific spot bitcoin exchange-traded funds. These include BlackRock's iShares Bitcoin Trust, Fidelity's Wise Origin Bitcoin Fund, Bitwise's Bitcoin ETF, and Grayscale's Bitcoin Trust.

Spot Bitcoin exchange-traded funds, Source: SoSoValue

These products, launched in January 2024, have accumulated substantial assets. They provide institutional-grade exposure to bitcoin without requiring direct cryptocurrency ownership or custody arrangements.

The ETF-focused approach addresses regulatory concerns and operational complexities. Bank of America joins other major institutions in treating spot ETFs as the preferred vehicle for client exposure to bitcoin.

Chris Hyzy, Chief Investment Officer at Bank of America Private Bank, outlined the rationale. Conservative investors may opt for 1% allocations, while clients with higher risk tolerance could consider up to 4% positions. The allocation depends on individual comfort with volatility and interest in thematic innovation.

Vanguard Reverses Position in Parallel Shift

The Bank of America announcement followed Vanguard's decision to permit trading of cryptocurrency ETFs on its platform. Both institutions reversed longstanding restrictions within hours of each other.

Morgan Stanley and BlackRock already allow advisors to recommend bitcoin ETFs under specific conditions. Bank of America's entry expands the list of major wealth platforms embracing digital asset advisory services.

Several large institutions maintain restrictive policies. Wells Fargo, Goldman Sachs, and UBS have not authorized similar advisory permissions for cryptocurrency products. Industry observers anticipate additional policy changes as competitive pressures mount.

The dual announcements signal momentum in institutional acceptance of digital assets. Bitcoin is trading at $90,874, showing an increase of 8.02% over the last 24 hours, while spot ETFs demonstrate consistent liquidity and market infrastructure.

BTC price chart, Source: CoinMarketCap

Bank of America's research divisions previously expressed skepticism about cryptocurrency's role in traditional portfolios. The institution cited concerns about volatility and questions regarding structural compatibility with established banking models.

Client demand and ETF performance data shifted internal perspectives. The spot products eliminated many operational barriers that previously deterred institutional participation. Strong custody partnerships and regulatory frameworks reduced perceived risks.

The January implementation timeline positions Bank of America within a broader industry transition. Major financial institutions are racing to accommodate client interest in Bitcoin exposure through compliant channels.