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BAC Opens Door to Crypto in Managed Portfolios: What Does This Mean?

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Key Takeaways

  • Bank of America will allow 1-4% crypto allocations in advised portfolios starting January 2026.
  • The move brings crypto into BAC's house view via research, guidelines and ETF-based access.
  • Select spot Bitcoin ETFs like those from Bitwise, Fidelity and BlackRock will anchor initial exposure.

Starting January 2026, Bank of America (BAC - Free Report) will let its wealth advisers recommend a small crypto allocation, typically 1% to 4%, for suitable clients across Merrill, Bank of America Private Bank and Merrill Edge. The key change isn’t that clients can buy crypto exposure (many already could on request), but that crypto is moving into the bank’s house view: research coverage, portfolio guidelines and adviser-led conversations. 

In a statement, Chris Hyzy, chief investment officer at Bank of America Private Bank, said, “For investors with a strong interest in thematic innovation and comfort with elevated volatility, a modest allocation of 1% to 4% in digital assets could be appropriate.”

In practice, BAC’s initial implementation is expected to focus on regulated spot Bitcoin ETFs (rather than direct coin custody), providing clients with a wrapper that resembles a traditional security, offering daily liquidity, statements and operational controls. The bank's CIO-covered Bitcoin ETFs will include the Bitwise Bitcoin ETF, Fidelity's Wise Origin Bitcoin Fund, Grayscale's Bitcoin Mini Trust and BlackRock's iShares Bitcoin Trust.

Bank of America’s shift could further mainstream crypto in advised portfolios, prompting several peers that are yet to allow to follow. Even a small 1-4% allocation across large wealth channels may drive meaningful inflows into spot Bitcoin ETFs. But the bank is positioning crypto as a high-volatility satellite exposure, so sizing and disciplined rebalancing remain crucial.

Other Financial Institutions Warming Up to Crypto Allocation

A broader shift is underway across the financial sector. Many institutions, including Morgan Stanley (MS - Free Report) and BlackRock (BLK - Free Report) , are now allowing their institutional clients access to crypto assets.

Morgan Stanley’s suggested 2-4% crypto allocation signals a higher risk budget for investors comfortable with volatility, treating crypto as a satellite position that can meaningfully impact returns, with suitability checks and disciplined rebalancing essential. BlackRock’s 1-2% stance is more conservative, framing crypto as a modest diversifier aimed at portfolio resilience rather than performance chasing. 

Together, both Morgan Stanley and BlackRock’s approach show mainstream institutions converging on a common idea: crypto may have a role in diversified portfolios, but position size, liquidity considerations and risk controls matter more than bold conviction.

Bank of America’s Price Performance, Valuation & Estimates

Shares of Bank of America have risen 23% this year. 

 

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From a valuation standpoint, Bank of America trades at a 12-month trailing price-to-tangible book (P/TB) of 1.97X, below the industry

 

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The Zacks Consensus Estimate for Bank of America’s 2025 and 2026 earnings implies year-over-year growth of 15.9% and 14.5%, respectively. In the past month, earnings estimates for 2025 and 2026 have increased to $3.80 and $4.35, respectively.

 

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Bank of America currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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