Investing app Betterment weighing how to 'offer crypto': CEO
Betterment, a top digital investing platform with roughly $30 billion under management, is weighing how to offer cryptocurrency opportunities for customers, the company's CEO Sarah Levy tells Yahoo Finance in a new interview.
She acknowledged that cryptocurrency is "volatile," saying Betterment could potentially mitigate some of the risk by educating users and limiting the asset to long-term portfolios.
Betterment, a privately held company, saw rapid growth in the first quarter amid the rise of retail investing online, though the digital advisor favors passive investing and doesn't allow users to hand pick stocks.
"We know investors increasingly have an interest in crypto, so what we're doing is really trying to figure out: Is there a way that we can offer crypto with a guided wrapper so that we can help educate along the way?" she says.
"I think how that will manifest itself will be more through a lens of a long-term buy and hold the asset as a smaller portion of a portfolio, rather than as sort of a trading opportunity short term," adds Levy, who took over Betterment in December after more than two decades at Viacom and ViacomCBS (VIAC).
The comments from Levy, made on June 22, came days before high-profile Ark Invest Founder Cathie Wood filed on Monday with the Securities and Exchange Commission (SEC) to create a bitcoin exchange traded fund (ETF).
Bitcoin (BTC-USD) received another vote of confidence on Monday when Ricardo Salinas Pliego, a billionaire who owns Mexico's Banco Azteca, encouraged his Twitter followers to buy bitcoin and said he was urging his country to accept it.
The absence of cryptocurrency investing on Betterment differs from popular trading app Robinhood, which allows users to buy and sell various cryptocurrencies, including Bitcoin, Ethereum (ETH-USD), and Dogecoin (DOGE-USD).
Coinbase Global (COIN), the largest cryptocurrency exchange in the U.S., went public in April at a valuation of nearly $100 billion. As of Tuesday afternoon, the stock price had fallen nearly 22% since its IPO.
Drawing momentum from the meme trading craze at the outset of this year, Betterment added $10 billion in customer assets over the first quarter, and saw new clients and net deposits grow 116% and 118%, respectively over that period, Betterment said in a statement in April.
Speaking to Yahoo Finance, Levy expressed enthusiasm about cryptocurrency, saying it could help Betterment users diversify their holdings since the asset is "counter cyclical," meaning its performance tends to run opposite the fluctuations of the economic cycle.
"Personally, I'm a big fan of crypto and I think it's a really interesting asset class to add into the mix," she says. "There's an opportunity really to help your diversification plan with crypto."
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