Bank of America (BAC.US) has recommended that its wealth management clients consider allocating a portion of their portfolios to cryptocurrency exposure. The bank is advising clients of Merrill Lynch, Bank of America Private Bank, and Merrill Edge to allocate 1%-4% of their assets to digital assets. Its investment strategy team will begin covering four Bitcoin ETF products starting January next year.

Chris Hyzy, Chief Investment Officer at Bank of America Private Bank, stated: "For investors enthusiastic about thematic innovation and capable of tolerating high volatility, a moderate allocation of 1%-4% to digital assets is a suitable choice. Our recommendation emphasizes selecting regulated instruments, prudent allocation, and a clear understanding of the associated opportunities and risks."

From January 5, 2026, the Bitcoin ETFs covered by the bank’s CIO team will include: Bitwise Bitcoin ETF (BITB.US), Fidelity Wise Origin Bitcoin Trust (FBTC.US), Grayscale Bitcoin Mini Trust (BTC.US), and iShares Bitcoin Trust (IBIT.US). Hyzy added: "The lower end of this allocation range is more suitable for conservative investors, while the upper end may appeal to clients with higher risk tolerance in their overall portfolios."

Previously, Bank of America’s high-net-worth clients could only access cryptocurrency products upon request, meaning over 15,000 wealth advisors at the bank were unable to proactively recommend crypto exposure. Many retail investors had to seek alternative channels for allocation. Nancy Fahmy, Head of Investment Solutions at Bank of America, noted: "This policy update reflects growing client demand for digital asset allocation."

The recommendation comes as other major banks and asset managers expand into the cryptocurrency space. Morgan Stanley’s (MS.US) Global Investment Committee suggested in early October that investors and financial advisors consider a 2%-4% crypto allocation, describing it as a "speculative but increasingly popular asset class that many (though not all) investors will seek exposure to."

Earlier this year, BlackRock (BLK.US) recommended a 1%-2% Bitcoin allocation, while Fidelity Investments proposed 2%-5% (with up to 7.5% for investors aged 30 and under). Reports on Monday indicated that Vanguard will allow select crypto ETFs and mutual funds on its platform starting Tuesday.

Currently, Morgan Stanley, Charles Schwab (SCHW.US), Fidelity, and JPMorgan (JPM.US) have opened access to certain crypto ETFs for all clients. Fintech bank SoFi (SOFI.US) began offering direct crypto trading services to retail clients a month ago, with Schwab, Morgan Stanley, and regional bank PNC Financial (PNC.US) expected to follow suit.

Many U.S. banks are awaiting congressional approval of a key cryptocurrency bill—which would establish a regulatory framework for federal oversight—before launching direct trading and custody services. JPMorgan’s global and U.S. wealth management divisions have yet to provide official crypto allocation guidance to their 5,900 advisors, though the bank has accelerated plans to expand in related areas this year. Since fall, JPMorgan has allowed Chase credit card customers to fund accounts via Coinbase Global (COIN.US).

The Trump administration’s policy shift this year—including rolling back Biden-era restrictions that sought to separate banks from certain crypto activities—has provided clearer regulatory clarity for the industry. While this has boosted Wall Street and investor optimism, the crypto market has faced a recent pullback. After hitting an all-time high of over $126,000 in early October, Bitcoin has since declined to around $87,000. Year-to-date, Bitcoin is down approximately 7%, while the S&P 500 has gained over 15%.