Bitcoin’s value has been soaring, with President-elect Donald Trump expressing support for cryptocurrencies. Financial advisers recommend caution when investing in bitcoin, suggesting dipping a toe in rather than diving headfirst due to its volatility. They advise understanding the basics of bitcoin and not allocating more than 2% of a portfolio to it. Bitcoin-based exchange-traded funds can help limit direct risk. While the recent surge in bitcoin has sparked interest from investors, Federal Reserve Chairman Jerome Powell remains skeptical, calling bitcoin a speculative asset. Despite the excitement in the crypto space, there are concerns about regulation, as SEC Chairman appointee Paul Atkins is expected to take a more aggressive stance in favor of cryptocurrencies. There are ongoing jurisdictional battles over crypto regulation between various government agencies. Financial advisers recommend considering how crypto fits into overall financial goals and not overstaking investments in it. Ultimately, they suggest focusing on what is known to be true based on historical data rather than speculating on regulatory changes.
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