Spanish bank BBVA now advises its wealthy customers to invest up to 7% of their portfolio in cryptocurrencies and Bitcoin to show how traditional banks start to see the potential of Bitcoin.
“With private clients, we have been advising bitcoin since September last year,” said Philippe Meyer, head of digital and blockchain solutions at BBVA Switzerland at the Digiassets conference in London. “The risk is high and we allow up to 7% of the portfolio in cryptocurrencies.”
The bank’s private wealth division currently recommends clients distribute 3% to 7% of their portfolio to bitcoin and cryptocurrencies, depending on their personal appetite. Although many private banks offer to execute Bitcoin or crypto transactions upon request, financial institutions around the world formally recommend that customers buy very little. BBVA is currently specially recommended in Bitcoin.
Meyer stressed that even modest allocations to Bitcoin can have a meaningful impact on portfolio returns, “If you look at a balanced portfolio, if you introduce 3%, you’ve already improved performance,” he said. “Actually 3% you are not taking any risks.”
BBVA has performed Bitcoin purchases for its customers starting in 2021, but Meyer said it was the first time it has officially offered distribution advice. In June 2021, the bank launched Bitcoin trading and custody services for private clients through its Swiss subsidiary. “By this innovative offer, BBVA positioned itself as a benchmarking body through blockchain technology,” said Alfonso Gómez, CEO of BBVA Switzerland.
BBVA’s interest in digital currencies has been further restored. Back in 2015, the bank made it clear that it views bitcoin and blockchain technology as past trends. In a statement, the BBVA seems increasingly prescient, “Institutions that understand Bitcoin and digital currencies will lead the new monetary system”, highlighting its belief that early adopters will gain strategic advantages.
This early support sets BBVA different from many peers, as few major banks are willing to interact with Bitcoin publicly.
First, interest in blockchain technology has become a direct investment guide, and now it is finally officially recommended in BBVA to allocate up to 7% of its portfolio to Bitcoin, a clear sign that banks see it as a long-term future.
