Key Takeaways
- BBVA is advising rich purchasers to allocate 3-7% of portfolios to bitcoin.
- This marks a uncommon occasion of a serious financial institution actively recommending bitcoin to purchasers.
- The transfer comes as regulators proceed to warn of dangers, however BBVA reviews constructive consumer response.
Spanish lender BBVA is now advising its rich purchasers to allocate 3% to 7% of their portfolios to bitcoin, in accordance with Philippe Meyer, head of digital & blockchain options at BBVA Switzerland.
Talking on the DigiAssets convention in London, Meyer said:
“With non-public clients, since September final 12 months, we began advising on bitcoin. The riskier profile, we enable as much as 7% of (portfolios in) bitcoin.”
BBVA’s transfer is notable, as most non-public banks merely execute consumer requests to buy bitcoin, reasonably than actively recommending it.
The recommendation comes after bitcoin reached one other file excessive in Might, following a restoration from the 2022 market downturn triggered by the collapse of a number of main exchanges, together with FTX.
Threat and regulatory setting
Regulators preserve a cautious stance, with the European Securities and Markets Authority noting that 95% of EU banks don’t interact in bitcoin actions.
Regardless of this, BBVA has executed consumer bitcoin purchases since 2021 and now formally advises an allocation to each bitcoin and ether, with plans to develop protection.
Meyer addressed threat considerations, saying:
“When you take a look at a balanced portfolio, should you introduce 3% you already increase the efficiency. At 3% you aren’t taking an enormous threat.”
BBVA purchasers have reportedly responded positively to the brand new steering.