Shocking Bitcoin Advice: Financial Pro Says Ditch 1-5% for a 40% Crypto Portfolio

Wall Street's playing catch-up—again. A maverick financial advisor just torched conventional portfolio theory by recommending Bitcoin allocations as high as 40%. That's not a typo.

Forget 'safe' exposure levels

Traditional wealth managers still peddle 1-5% crypto allocations like it's 2021. Meanwhile, forward-thinking advisors are betting big on Bitcoin's asymmetric upside—and laughing all the way to the (decentralized) bank.

The new math of wealth preservation

With fiat currencies inflating faster than a balloon animal at a kids' party, that 40% stake starts looking less crazy and more like basic financial hygiene. Just don't tell the guys still pushing 60/40 stock-bond splits.

Closing thought: If your advisor won't discuss 40% Bitcoin allocations, ask what other 20th-century strategies they're still clinging to—along with their fax machine and Rolodex.

40% in BTC?

As reported by CNBC, Ric Edelman, head of Digital Assets Council of Financial Advisors, noted that a lot has changed since his initial take on the matter, which was four years ago. At the time, he advised investors, especially the more conservative ones, to allocate around 1% of their portfolios to BTC.

“Today I am saying 40%, that’s astonishing. No one has ever said such a thing,” he said now.

The reason for this monumental increase in his recommendation is the global status of Bitcoin (and some other cryptocurrencies). Most were ridiculed several years ago when it was unknown whether countries, such as China, or even the US, might move to ban them in some form. Now, the situation is entirely different as the US and a few others have presented plans on how to accumulate BTC as a reserve asset.

Old-School 60/40 Doesn’t Work

One of the most popular theories for investing is allocating 60% of a portfolio into stocks and 40% into bonds. While this classic split may have worked in the past, the landscape is different now, and it requires more risk and a greater exposure to stocks, according to Edelman.

“If you’re a financial advisor and you had a 30-year-old client who was saving for their long-term future, you WOULD tell them to put 100% of their money in stocks, because they have 50 years to go. Today’s 60-year-old is kind of like yesterday’s 30-year-old. You need to get better returns than you can get from bonds, and you need to hold equities longer than ever before.”

Instead of such solid exposure to stocks, though, he said people should diversify with crypto and BTC in particular, which is a “wonderful way to improve modern portfolio theory statistics.”

“The crypto asset class offers the opportunity for higher returns than you’re likely to get in virtually any other asset class,” Edelman concluded.