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Talking Crypto with Your Planning Clients

Tyrone Ross Jr. April 21, 2022

Cryptocurrency in a financial plan

I get it, crypto is complicated, and you may not feel comfortable talking to your clients about it. It’s a highly nuanced space, completely different from anything advisors are used to, and driven entirely by retail investing. The crypto industry moves so fast that even regulators can barely keep up.

But whether you like it or not, crypto assets are here to stay. And financial professionals have a fiduciary duty to help their clients make smart financial decisions.

How Do You Start the Conversation with Clients?

It’s important to be proactive and initiate the conversation around crypto assets with your clients. At the end of last year, there were 90 million verified Coinbase accounts1. Chances are your clients have an account, even if you don’t know about it. You don’t want them doing anything on their own that’s going to impact the success of their plan.

Then, simply ask your clients if they have any interest in it or if they already own any. Explain that you’re asking because you need to report it if they’re making trades and monitor anything that could impact the plan. You can even say that your firm is still exploring the space, that you don’t have an official position yet and you’re keeping a close eye on regulations that are just around the corner, but you know the first step in helping is to make sure everything is tracked.

In order to track the assets, you’ll need a system in place. You don’t need to manage their crypto assets—you just need a financial planning software where you can see it and store all of their information.

If you can track when the client purchased crypto assets, where they’re storing these assets, how they’ve traded them, and what the cost basis is, you’ll be doing them a great service. They have to know this information for tax and estate planning purposes, and chances are they’re not keeping track of any of it.

4 Pillars of Incorporating Crypto Asset Advice into Your Planning Practice

Getting visibility into clients’ crypto activity is a great way to get your firm involved in these kinds of discussions. But there’s certainly a lot more value you can provide as a fiduciary to help your clients.

You don’t need to be an expert on all aspects of the crypto world to guide clients. You just need to be conversant in some of the key aspects of crypto investing and understand how to incorporate these assets into a larger financial plan.

When I speak to financial professionals about incorporating advice on crypto assets into their practice, I point to four essential things they need to be able to do:

1. Update the Client’s Risk Tolerance Profile

The crypto space is volatile. The minute a client brings up cryptocurrency, I would recommend revisiting their risk profile on the spot because there’s a good chance this investment they’ve decided to make on their own does not fit into their existing risk profile.

2. Create a New Investor Policy Statement

I also recommend redoing the Investor Policy Statement to lay the framework of the relationship moving forward. Set the expectation that you’ll start meeting more frequently than you already do since this is such a volatile space, things change frequently, and it could have significant ramifications to their financial plan.

3. Adjust the Financial Plan

The financial plan is, of course, your clients’ roadmap for what they want to achieve with you as an advisor. Part of why it’s so important to have visibility into clients’ crypto activity is to make sure they’re not doing things like trading at high volumes without understanding that it’s all taxable or investing in amounts that risk the success of their plan. Talk to clients about why they’ve invested in crypto and what they want to achieve, consider what level of investment and risk makes sense for their situation, and then adjust the plan accordingly.

4. Talk About Estate Planning

As an industry, there is a major lack of understanding and development in this area, but there’s still a lot of value you can offer as a trusted financial professional. If you can learn just a few of the basics of crypto investing, you can educate your clients on things such as the fact that there is no FDIC insurance on crypto assets, so if it’s gone, it’s gone forever. You can teach them about public versus private keys, self versus centralized custody, or the fact that all their trading is a taxable event. You can provide value by keeping clients level-headed and focused on what everything means within the context of building and transferring wealth.

Taking Advantage of the Long-term Opportunity

Crypto assets have gained mass acceptance. At the peak, they were valued at over $3 trillion2 without a single dollar of wealth management money. Crypto investors, especially Millennials and Gen Z who have largely grown up with crypto, have created meaningful wealth with these assets. Crypto is a retail investing trend that’s not going away, and it will continue to be pushed forward by those the industry has typically underserved.

The future of this space for financial professionals is an assets under advisement (AUA), non-custodial relationship. Investors aren’t likely to hand over their Coinbase account for advisors to manage their crypto investments. This means planners have to be prepared to monetize advice on these assets somehow.

I know an advisor who recently had a client with a $20 million Coinbase account. The advisor had no idea this account existed until the client mentioned they were getting paid in crypto assets, which brought up a whole host of issues. The advisor had to call a meeting with tax experts and lawyers who were well versed in the space to discuss the situation. The only person on that call not being paid was the advisor—clearly this is a missed opportunity for earnings.

As I mentioned earlier, having the right technology in place will be critical for your ability to be prepared for crypto conversations. If you can send someone a link to a web portal for them to connect all their accounts, you can then bring those assets under your advisement, even if you can’t directly manage them. Of course, this also means that you’ll need a separate planning fee apart from your AUM fee or other forms of compensation. Once you have visibility into crypto assets, you can let the client guide the relationship and advise them when appropriate.

Simply being conversant about crypto assets can be huge for the future growth of your firm. Investors have built wealth with these assets and they will be coming to advisors with questions. Being able to profitably guide planning clients with crypto assets will position you well to attract and serve future clients.

Crypto Asset Education for Financial Professionals

One of the things I love about crypto assets is that it’s almost impossible for clients to get into this space without going back to the beginning. To understand the basics of crypto, you also have to understand the basics of investing, what an asset is, why you invest, and how to make your money work for you. In this regard, financial professionals are already prepared to help clients.

To be conversant in crypto takes some homework. I recently participated in a webinar with eMoney where we discussed in detail how to work with clients who have crypto assets, how to position your firm for the future, where you can learn more about how crypto assets work, and a number of nuances about the crypto space itself.

Take a deep dive into the subject by watching the on-demand webinar here. (Replay not eligible for CE credits)



1. Helms, Kevin. “Coinbase’s Trading Volume Grew 8.5 Times in 2021 — With 89 Million Verified Users.”, 2022. February 26. Ossinger, Joanna. “The World’s Cryptocurrency Is Now Worth More Than $3 Trillion.” Time, 2021. November 8.

DISCLAIMER: The eMoney Advisor Blog is meant as an educational and informative resource for financial professionals and individuals alike. It is not meant to be, and should not be taken as financial, legal, tax or other professional advice. Those seeking professional advice may do so by consulting with a professional advisor. eMoney Advisor will not be liable for any actions you may take based on the content of this blog.

The views and opinions expressed by this blog post guest are solely those of the guest and do not necessarily reflect the opinions of eMoney Advisor, LLC. eMoney Advisor is not responsible for the content, views or opinions presented by our guest, nor may eMoney Advisor be held liable for any actions taken by you based on the content, views or opinions of the guest.

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About the Author

Tyrone Ross is the founder of 401, a storytelling consultancy. As the former CEO and Co-founder of Onramp Invest, he raised $7M in venture capital from Gemini Frontier Fund, Coinbase Ventures, the SoftBank Opportunity Fund, and others. In 2019 he was recognized by Investment News as one of their 40 under 40 and by as a top ten advisor set to change the industry, and in 2020 he was named as one of 20 people who will change wealth management by He was recently named one of Investopedia's Top 100 financial advisors, included on the ThinkAdvisor 2021 IA25: VIPs Pushing Advisors Forward, and acknowledged as one of Barron's 10 people to watch in wealth management in 2022.

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