Amidst the dip, Wells Fargo President said the institution is moving to adopt what it cited as a professionally managed solution for cryptocurrency. In his interview, he disclosed; “We think the cryptocurrency space has just kind of hit an evolution and maturation of its development that allows it now to be a viable investable asset.”
Moving to adopt crypto, how?
Not until the dip which coincidentally happened when China is systematically placing a ban on crypto, paving ways for its digital coin, E-Yaun, the Wells Fargo Investment institute beamed its torchlight on crypto. Its President Darrell Cronk revealed to the Insider, his team is planning to start offering crypto services. plans to the Insider in an interview published Wednesday.
In his interview, he disclosed the institution has been doing due diligence and thorough research to adding a professionally managed solution for months. He, therefore, explained the institution is currently at its final stages of adding an actively managed cryptocurrency investment strategy to its platform for qualified clients. The president’s report shows that Greg Maddox, head of Global Manager Research, a division of Wells Fargo Investment Institute. is leading the research and that the service is hopefully adding to the platform around mid-June.
Why Offering Crypto Services?
It is however surprising that the firm similar to several other firms such as JP Morgan suddenly changed its mind to adopt crypto. Recall the firm previously expressed concern about crypto regulatory clarity. John LaForge, head of real asset strategy for Wells Fargo Investment Institute, said in December that his team did not have an official recommendation on cryptocurrency and clients could not hold crypto at Wells Fargo. But, why the sudden change, people may want to know?
In response, Cronk clarified: “We think the cryptocurrency space has just kind of hit an evolution and maturation of its development that allows it now to be a viable investable asset. Notwithstanding, he cautioned that cryptocurrency is an evolving asset class that needs deeper due diligence. “So we’re still not suggesting in our work that it is its dedicated asset class with a strategic allocation to it in every portfolio,” he emphasized.
“For those investors who qualify and have an interest, there’s some good academic and money-management work to suggest that it can be a nice diversifier to portfolio holdings,” he further said.
Why the Wells Fargo’s Professional Managed Solution?
The crypto new births, Wells Fargo’s investment strategy is expected to be limited to qualified investors. Cronk explained that there are still “plenty of risks” associated with cryptocurrency investing, including operational, regulatory, and technology failures. However, he concluded:
“There’s a whole element of consumer protections and regulations that have to still evolve with the changing landscape. So we’re not without risk, it’s just that we think there can be a viable investable option for those clients who show an interest.”