Respected financial advisory services once laughed off crypto investments. Now, they’re seeking out specialized fund managers, especially as Bitcoin trades around $100,000. The interest goes beyond basic exchange-traded fund (ETF) investing — institutions and RIAs want strategies with greater depth.

While BlackRock and Fidelity grab ETF headlines, a much broader story unfolds behind the scenes. Family offices, pension funds, and other mainstream financial organizations are quietly building relationships with crypto managers that offer more than passive exposure. These specialized crypto firms aren’t chasing attention — their expertise draws investors to them.

This article delves into the progress crypto investing firms have made in going mainstream and what emerging firms can do to make the jump.

Crypto Investing: Institutional Money Leads the Way

Three shifts signal how fast institutions are moving into crypto.

1. Pension funds aren’t just talking crypto anymore. According to FundFire, the State of Wisconsin Investment Board invested over $100 million in BlackRock’s iShares Bitcoin Trust ETF, and Michigan’s state retirement system added $7 million to ARK’s Bitcoin ETF. These aren’t test runs—they’re real commitments.
2. Family offices show the same appetite. “In crypto, we’re much more open to meeting with newer managers who might not have long traditional track records,” says one senior investment researcher at a multi-billion dollar family office. “The uniqueness of the crypto asset class means traditional metrics of manager selection don’t apply the same way. We’re looking more at their specialized expertise.”
3. BlackRock’s stamp of approval pushed more investors over the edge. When the world’s largest asset manager suggested a one-to-two-percent Bitcoin position, it gave institutions the framework they needed to move forward.

Regulatory Clarity Changes Everything for Crypto Investing

Trump’s win changed the rules for crypto managers. His pro-crypto stance points to clearer regulations, which is exactly what institutions need to see.

While the big providers rolled out basic Bitcoin funds, smaller and emerging firms are crafting something different.

The media is noticing. Since the election, reporters from The Wall Street Journal, Barron’s, and CNBC started calling. They wanted more than ETF flow numbers. They demanded to understand what specialized crypto managers are thinking and building.

They are no longer just covering Bitcoin prices. Journalists are digging into investment approaches, asking how boutique firms manage money differently from others in the sector. They see that the real story isn’t in the headlines about trading prices — it lives in the strategies these smaller shops are telling.

Specialized Crypto Investing Strategies Emerge

BlackRock, Grayscale, and Fidelity may currently seem to own the Bitcoin ETF space, but they don’t own every idea. Crypto investing is growing up, and managers are responding with new ways to trade it.

• Some firms are building research engines mixing data science with old-school analysis.
• Others are developing hedging plays using shorts and options.
• More are identifying specific corners of the market to mine.

These strategies include mutual funds, ETFs, private funds, and separate accounts, giving investors the exact structure and exposure they want.

Financial Advisors Join the Crypto Trend

The numbers tell the story. A recent Investment News survey found 16 percent of advisors plan to add crypto to client portfolios this year. Another 24 percent will maintain their current positions, while only five percent plan to pull back. A significant percentage of the mainstream financial sector is committed to crypto.

Those who invest keep it tight, typically one to three percent of a portfolio. They match positions to client risk tolerance and time horizons, often sticking to Bitcoin and Ethereum. Some tap platforms like Eaglebrook for smoother access.

Spot Bitcoin ETFs opened new doors by adding legitimacy. But advisors aren’t throwing caution away. They view crypto as a calculated bet worth taking in a limited way.

Asset Managers Hunt for Crypto Partners

Traditional asset managers aren’t sitting still. They’re knocking on emerging crypto firms’ doors, offering everything from sub-advisory deals to outright purchases.

In March 2024, CoinShares gained an exclusive option to acquire Valkyrie Funds LLC. The deal will add Valkyrie’s Bitcoin ETF and regulatory licenses to CoinShares’ toolkit, bringing in $530 million in assets across several funds. CoinShares plans to run Valkyrie’s product line under its brand, using it as a platform for U.S. expansion.

Deals like this work because both sides win. Big firms get specialized crypto knowledge and fresh strategies. Emerging crypto managers maintain their favorable regulatory framework while gaining institutional backing.

Creating Market Presence

Emerging crypto managers need more than good strategies to succeed. They need to stand out against considerable competition. It’s not enough to copy the crypto ETFs playbooks. You must go beyond by clearly identifying and communicating what makes you different.

Focus on your insights, not your products. Analyzing market shifts and discussing approaches to trading will garner more attention than basic fund updates. Build your digital presence through LinkedIn and email, but keep it real — share what you see in the markets and how you respond to it.

You likely started your offering with your own capital. Then added more from people who know you. Each million you have and raise makes the next one easier. Big investors want in, but they don’t want to make up too much of your portfolio, typically 10 to 15 percent.

Begin in your backyard. Local investors give you time to explain your approach, and those conversations will build naturally. Strong local backing often pulls in bigger fish.

Reporters want your take, too. They’re digging for stories beyond Bitcoin prices, looking for managers who’ve built different strategies. Your approach might be exactly what they want to write about.

The Opportunity Window for Crypto Firms

The door is open for boutique crypto managers right now. Clear rules and hungry investors create perfect conditions for firms with crypto knowledge. But markets don’t wait.

As more players join the game, today’s opportunities won’t last. The firms that act now – the ones with real expertise and clear strategies – will build lasting businesses. Those who stay invisible will likely shut their doors, regardless of their skill.

Want to see if your crypto expertise fits what investors need now? Schedule a strategy session to explore how your approach aligns with today’s demand.

Dan Sondhelm is the CEO of Sondhelm Partners. He works with boutique asset managers to help them raise AUM, stand out in crowded markets, and spark more meaningful conversations with prospects.