Oisin Breen

There are a number of mis-conceptions here.  First, crypto trades pretty homogenously at present - meaning diversification is pretty close to meaningless.  So whether you hold 100% BTC or a pack of 30 different cryptos, your returns are going to be very highly correlated.

Second, all of the coins that exist today except BTC are "tokens" with NO intrinsic economic value.  Holding one Solana token doesn't give you ownership rights to anything except governance issues.  It's not an "asset" at all if on a decision one can mint an unlimited supply of them!

Maybe more importantly - what exactly do the Betterment clients want out of a "crypto product"?  Is it the ability to speculate, a store of wealth, a source of wisdom on these new assets, etc.?  That should dictate what the Betterment product looks like - but instead of that they just make a generic acquisition of a company with a poorly conceived strategy,  and bolt it on to the mother ship.  What a joke.

I suspect the real problem is that the good folks at Betterment, including Ms. Levy, don't know anything more about BTC and crypto-currency than the supposed clients and advisors they purport to serve.     Like ESG last year, crypto is the latest meme of the day - so Betterment does what any fast follower with a pocket-full of money does and makes a crappy acquisition.

Betterment's new CEO spices up baked potato robo menu with self-directed crypto allocations; one guru calls it a 'square peg'  in round hole, but Morningstar analyst sees 'leapfrog' potential

Betterment

cryptocurrency

Stripped down to its essentials, financial advice is a fairly straightforward proposition. Done well, a highly ethical individual stewards the assets and actions of an investor in a personal and professional interchange.
 
But now a vibrant new class of entrepreneurs is staking their fates and their fortunes on the premise that financial advice can be delivered in a better, cheaper, easier, more ethical, more transparent manner and, as a bonus, in a way more devoid of human annoyance on both ends of the transaction.
 
Cue the robo-advisors, arguably a callous misnomer for automated asset management. 
 
The prototypical robo-advisory entrepreneur has more brands on his or her resume than NASCAR. The bona fides of these industry upstarts often include Ivy-level colleges and MBA programs at Harvard or Stanford. They are often flush with IPO dollars realized at concerns like LinkedIn, Facebook, eBay, Amazon  and Microsoft. 
 
Robo-folk believe that technology is not an enabler of advice but rather, if engineered correctly, advice itself in digital form. 
 
And, they believe the best solutions originate in Silicon Valley or academia, not Wall Street. Robo-entrepreneurs are white-boarding the whole business model, culture and technology from scratch in the conviction that little can be learned from a legacy advice system still rooted in an investment banking culture acting under the core premise that if stockbrokers get rich some of the good effects will trickle down to clients – with the clients none the wiser. 
 
Robo-advisors are a scintillating topic for students of the advice game as they grow by hundreds of millions in assets every month, constantly evolve their business models and receive cash infusions from ever-larger swaths of venture capitals.
 
Throw in the fact that robo-advisors have yet to see a dime in profits -- and won’t in the foreseeable future -- and you have real intrigue. 
 
RIABiz has avidly covered the fast-evolving robo-advice phenomenon and will continue to do so. We present the growing body of articles here.

Robo-Advisors

New York City robo-advisor CEO Sarah Levy bought 'Makara' after 90% demand it; they can choose crypto for 100% of portfolios but must pay a fee of 100 basis points.

Betterment's new CEO spices up baked potato robo menu with self-directed crypto allocations; one guru calls it a 'square peg' in round hole, but Morningstar analyst sees 'leapfrog' potential

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Brian Murphy

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