Investment robo-advisor Betterment partnered with crypto exchange Gemini to launch a crypto investing portfolio service for its 730,000 customers.
Key Takeaways
- Betterment has partnered with Gemini to offer clients customized crypto investment plans based on risk profiles and interests.
- Betterment said it hopes to foster a desire in clients for long-term investment in cryptocurrencies, with the assets coming from those listed on Gemini’s crypto exchange.
- The Betterment-Gemini deal is one of many similar moves by established financial services companies, showing continued interest in crypto despite the overall bear market.
Betterment Adds Customized Crypto Portfolios Through Gemini Deal
The partnership will give Betterment’s customers access to customized crypto investment plans based on their risk profiles and interests. The digital assets will come from Gemini’s platform. The exchange has a comparatively stringent process for listing tokens.
Officials from Betterment have said that the option is meant to foster a long-term focus when it comes to crypto investment, as “the burden of asset selection and the management of those assets” is removed from clients. The firm’s idea is to give clients easy access to crypto investments, with fewer of the risks associated with crypto.
Betterment is a robo-advisor that offers its users several products to help with their investing. One of the platform’s key features is the personalization of investments. To extend this to clients’ crypto investments, Betterment acquired crypto robo-advisor startup Makara in February 2022.
The latest partnership is also yet another move by Gemini that focuses on working with established financial firms. The exchange, which is known for prioritizing compliance, in 2021 launched a crypto rewards card in partnership with Mastercard and in that year also joined with Australian fund manager Holon Global Investments to raise funds to buy Filecoin, the world’s largest decentralized storage network.
Fidelity and Others Also Diving Deeper Into Crypto Despite Winter
The partnership between Gemini and Betterment is just one of many that show that mainstream legacy finance institutions have an interest in the crypto market. For example, Fidelity, the largest 401(k) management firm, announced earlier in 2022 that it would allow investors to diversify their 401(k) accounts with Bitcoin. The Digital Assets Account, as it is known, gives plan participants at companies that offer 401(k)s access to Bitcoin—and MicroStrategy has jumped on board as one of the first companies to sign up.
Institutional investors seem to be the main target, with Nasdaq reportedly also set to launch institutional Bitcoin and crypto custody services, although the move still requires regulatory approval. As for retail investors, Fidelity is reported to be considering offering Bitcoin to this group as well.
The Bottom Line
The cryptocurrency market has received a lot of criticism in recent months over its volatility, but recent deals to enter the sphere indicate that some established financial services firms are not deterred. Some analysts expect the market to go up from here, with bitcoin more or less holding at its current support levels. With more regulations coming in, and overall better infrastructure, several financial services firms may be looking at the crypto market with optimism.