Acorns users can now allocate up to 5% of their portfolio to a Bitcoin exchange-traded fund, depending on their investment profile.
A fintech company that helps millions of Americans save and invest now allows its users to gain exposure to Bitcoin.
Acorns — which has an estimated 8.2 million users and $5 billion in assets under management — says its customers can allocate a percentage of their portfolio to a BTC exchange-traded fund.
Explaining the rationale behind its decision, the company said BTC gives investors the opportunity to diversify their holdings — and claimed cryptocurrencies and the stock market have a low correlation. (However, BTC and the Nasdaq 100 have traded in lockstep for most of this year.)
Setting out its new stance in a manifesto, Acorns revealed it has been keeping its eye on cryptocurrencies since it went mainstream — with executives asking themselves whether BTC would be beneficial for the "financial wellness" of their users in the long run.
Noting that Bitcoin is volatile — doubling its value in 2021 but erasing most of these gains in January 2022 alone — Acorns explained that it believes the ProShares Bitcoin Strategy ETF, which offers exposure to BTC futures, is the best approach, adding:
"Similar to stock market futures, Bitcoin futures give you exposure to Bitcoin by investing in their potential value, without requiring that you own the cryptocurrency itself."
How It'll Work
Acorns says the maximum portfolio allocation that its users can make to Bitcoin stands at 5% — and this will be determined by their investment profile, which takes their age, income and goals into account.
Explaining that its approach can help crypto-curious investors get involved in this fast-moving space without "betting the farm on Bitcoin all at once," Acorns added:
"By offering a Bitcoin ETF, we streamline the process. No need for extra apps, digital wallets, and vulnerable passwords."