Bank of America Recommends 1–4% Crypto Exposure Through Regulated ETFs

Highlights:

• Bank of America recommends 1% to 4% crypto exposure for wealth clients on multiple platforms.
• BofA will guide clients on four major Bitcoin ETFs safely.
• Major banks expand crypto offerings as Bitcoin drops sharply to around $85,000.

Bank of America, one of the biggest U.S. banks, told its wealth clients they can keep some crypto in their portfolios, Yahoo Finance reported on Tuesday. The bank suggested 1% to 4% exposure for clients using Merrill, Bank of America Private Bank, and Merrill Edge platforms. Chris Hyzy, chief investment officer at Bank of America Private Bank, mentioned that investors interested in innovation and able to handle higher volatility might find a small allocation of digital assets suitable. He also emphasized choosing regulated products. 

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Bank of America is now recommending a 1%–4% crypto allocation for clients of Merrill, the Private Bank, and Merrill Edge, and will begin CIO coverage of four bitcoin ETFs — BITB, FBTC, Grayscale’s Mini Trust, and IBIT — starting Jan. 5, 2026. This marks a shift from its previous…

— Wu Blockchain (@WuBlockchain) December 2, 2025

BofA Expands Bitcoin ETF Access for Wealth Clients

Starting January 5, Bank of America will cover four Bitcoin ETFs: Bitwise (BITB), Fidelity (FBTC), Grayscale (BTC), and BlackRock (IBIT). The bank will guide clients on these ETFs to help them invest in Bitcoin safely.

Hyzy added that the lower-end suits cautious investors, while the higher-end suits risk-takers. Previously, wealthy clients could access crypto only on request, which meant over 15,000 advisers could not recommend it. Nancy Fahmy, head of investment solutions, said this change reflects growing client demand for digital assets.

Other Major Banks Follow, Increasing Crypto Exposure Options

Other major banks are also expanding access. In October, Morgan Stanley suggested a 2%-4% allocation, noting crypto is “speculative but increasingly popular” and not suitable for every investor. BlackRock recommended clients hold 1%-2% in Bitcoin starting in 2025. Fidelity in March last year suggested 2%-5% for most investors, and up to 7.5% for those under 30.

Bloomberg reported Vanguard will allow some crypto ETFs and mutual funds this week, while banks like Morgan Stanley, Charles Schwab, Fidelity, and JPMorgan Chase already let clients invest in certain crypto ETFs.

Fintech bank SoFi began direct crypto trading for retail clients a month ago, with other banks such as Charles Schwab, Morgan Stanley, and PNC expected to follow. Many banks are waiting for Congress to finalize crypto rules, which would guide federal oversight before offering full services. JPMorgan Chase has not yet issued official crypto guidance to its 5,900 advisers. This year, it has allowed Chase credit card users to fund accounts through Coinbase Global. The Trump administration removed some Biden-era rules, providing clearer guidance for banks.

Bitcoin has seen recent declines. After reaching an all-time high above $126,000 in early October, it fell roughly a third to $85,000 by Monday.

Fed Signals New Rules for Banks and Stablecoins

Moreover, the top bank supervisor at the Federal Reserve (The Fed) has warned that new rules for banks and stablecoin issuers are coming soon. Michelle Bowman told the House Financial Services Committee that regulators need to act now to keep innovation and stability balanced.

The new rules aim to encourage fair competition between fintech firms, Wall Street, and crypto businesses. Bowman said her main job as a regulator is to support responsible innovation. She also asked other regulators to improve how they handle risks from new developments.

News nugget in FDIC acting chair Travis Hill’s testimony to the House tomorrow:

The FDIC will issue its first proposed rulemaking for the GENIUS Act later this month to “establish our application framework” for stablecoins. So far regulators have only issued an ANPR pic.twitter.com/4DOcDTGPQX

— Brendan Pedersen (@BrendanPedersen) December 1, 2025

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