What Occurred: Regulatory constraints round cryptocurrencies are a trigger for concern for wealth managers throughout the globe.
Jim Paulsen, Chief Funding Officer on the Leuthold Group that manages over $1 billion, is frustrated that he can not buy Bitcoin on behalf of its purchasers, Reuters has reported.
“What I like about bitcoin is… its correlation to shares and different belongings is awfully impartial,” mentioned Paulsen.
Comparable sentiments have been expressed by the Chief Government of Wealth Consulting Group, Jimmy Lee, who mentioned, “Not permitting the acquisition of crypto is one thing that’s irritating to many advisors, however it’s such a risky asset that many traders find yourself doing it on their very own.”
Why It Issues: As issues at the moment stand, the U.S Securities and Trade Fee doesn’t acknowledge cryptocurrencies as a standard asset class, like shares or bonds, and disclosure necessities for mutual funds that personal cryptocurrencies stay unclear.
In gentle of this regulatory uncertainty, funding managers proceed to be apprehensive about shopping for Bitcoin (CRYPTO: BTC), Ethereum (CRYPTO: ETH), and different altcoins.
Bitcoin and Ethereum have every returned over 900% since March 2020 regardless of being the 2 largest cryptocurrencies by market cap, making them a gorgeous funding class for wealth managers.
What Else: Whereas regulatory readability within the U.S is but to take form, one of many largest cryptocurrency exchanges in China was simply granted regulatory clearance to ascertain a crypto asset administration fund.
In an official announcement earlier right this moment, Huobi mentioned that it had been granted a license from the Hong Kong Securities and Futures Fee to launch a cryptocurrency asset administration portfolio.
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