Ric Edelman, founder of Edelman Financial Engines, a $300 billion investment advisory firm, has urged investors to reconsider the traditional 60/40 stock-bond portfolio model by significantly increasing exposure to cryptocurrencies.
In a whitepaper published through the Digital Assets Council of Financial Professionals (DACFP), Edelman argues that the 60/40 allocation is outdated due to longer lifespans and technological advancements. He recommends that conservative investors allocate 10% of their portfolios to crypto, moderate investors 25%, and aggressive investors up to 40%.
Appearing on CNBC’s Crypto World, Edelman highlighted crypto as the best investment opportunity of the decade, stating that it should hold a larger portion within the equity allocation. He further noted that avoiding crypto now equates to speculation against market growth, especially as global market indices begin to include around 3% crypto exposure.
This stance marks a significant shift from Edelman’s 2021 position, where he suggested only a 1% allocation to cryptocurrencies. He attributes this change to the maturation of the crypto industry into a core asset class, supported by government acceptance and long-term viability.
Looking ahead, Edelman projects Bitcoin could reach a $19 trillion market cap by 2030 with a price target of $500,000 per coin. He bases this on the potential inflow of 1% of the global investable assets, estimated at $750 trillion, into Bitcoin.
Edelman urges financial advisors to increase their crypto recommendations from 2.5% to at least 10%, reflecting the evolving landscape of digital assets.