Major Asset Manager Lifts Crypto Trading Restriction

Leading US Asset Manager Reverses Long-Standing Crypto Restriction

In a notable shift for traditional finance, a major US asset manager announced it will permit trading of regulated cryptocurrency exchange-traded funds (ETFs) and mutual funds on its brokerage platform beginning in early December 2025. The move ends a multi-year policy that limited client access to digital-asset-focused products.

The decision allows customers to buy and sell funds that hold Bitcoin, Ether, XRP, Solana and similarly regulated tokens, while explicitly excluding vehicles tied to speculative memecoins. The firm also clarified it does not plan to launch proprietary crypto products at this time.

Why the U-Turn?

Industry observers point to several converging factors that prompted the reversal:

• Persistent client demand: Retail and institutional clients increasingly sought regulated exposure to Bitcoin and Ether through familiar brokerage channels.
• Product maturation: Since the debut of several spot crypto ETFs in 2024, operational processes for servicing these products have become more standardized and resilient.
• Regulatory and market clarity: Greater regulatory scrutiny and clearer custody standards reduced operational and compliance uncertainties.
• Leadership and strategic recalibration: Changes in senior management and strategic priorities accelerated internal reassessment of product eligibility.

The shift reflects a broader industry trend in 2025: mainstream asset managers are increasingly integrating regulated crypto products into client offerings without necessarily creating their own token funds.

Context: Crypto Market and ETF Trends in 2025

While the crypto market experienced significant volatility in 2025 — with periods of drawdown and ETF outflows — regulated crypto funds have continued to display robust secondary-market liquidity. Spot Bitcoin and Ether ETFs that launched in prior years amassed substantial assets, demonstrating persistent investor appetite even through turbulent markets.

Macro factors in 2025 influenced investor behavior:

• Monetary policy adjustments and inflation dynamics continued to shape risk asset allocation.
• Institutional adoption of crypto as a portfolio allocation tool progressed cautiously.
• Regulatory guidance from US and international authorities clarified custody, reporting and AML obligations.

These developments reduced some historical barriers for traditional brokers weighing whether to offer regulated digital-asset products to millions of retail clients.

Operational Readiness and Risk Controls

The asset manager cited improvements in the service ecosystem around crypto ETFs as a key enabler. Service providers and custodians have strengthened:

• Custodial safeguards and insurance coverage for on-chain and off-chain holdings.
• Clearing and settlement processes aligned with conventional ETF infrastructure.
• Compliance tooling that screens funds for regulatory adherence and token eligibility.

As a result, the firm said it can maintain its conservative product philosophy while accommodating a wider range of client risk tolerances. It will continue to screen eligible funds and exclude any products tied to SEC-defined memecoins or similar high-risk categories.

Implications for Investors

The policy reversal has several important implications for both retail and institutional investors:

• Expanded access: Tens of millions of brokerage customers gain easier on-ramp options to regulated crypto exposure through accounts they already use for stocks and ETFs.
• Product due diligence remains critical: Although access is expanding, investors should evaluate fund structure, fees, custody arrangements and tracking methodology.
• Risk segmentation: Traditional brokers are likely to maintain firm-level controls, offering ETFs that fit within diversified or retirement-focused allocations while excluding speculative products.
• Potential for incremental flows: Opening mainstream channels can attract new capital into regulated crypto funds, particularly from conservative investors seeking compliant exposure.

For long-term savers and retirement-account holders, the addition of regulated crypto funds to mainstream brokerages could mean crypto becomes a more considered part of diversified portfolios — albeit within strict gatekeeping and suitability frameworks.

What This Means for Market Legitimacy

The move signals growing acceptance of digital assets within conventional financial institutions. Even without creating in-house token products, allowing clients to trade regulated crypto funds enhances legitimacy by:

• Normalizing crypto ETFs as mainstream financial instruments.
• Demonstrating that infrastructure and compliance frameworks can support digital assets.
• Encouraging other large custodians and brokerages to reassess product policies.

Market participants view the development as another step toward integrating crypto into the broader investment ecosystem while preserving regulatory and investor protections.

Industry and Regulatory Considerations

As major brokerages add regulated crypto funds, regulators remain focused on areas such as market integrity, investor protection and custody standards. Key regulatory considerations in 2025 include:

• Clearer definitions around asset classification and eligible fund components.
• Ongoing scrutiny of fund disclosures, fee transparency and underlying index methodologies.
• Enhanced AML/KYC measures and reporting requirements for crypto-related flows.
• Standards for custody, insurance and third-party service provider oversight.

Institutional adoption tends to accelerate alongside regulatory clarity. This dynamic has been evident across 2024–2025 as more traditional firms moved from outright exclusion to carefully curated access.

MEXC Perspective: What Traders and Investors Should Watch

At MEXC, we monitor institutional developments closely because they influence liquidity, product innovation and regulatory norms across markets. Key factors traders and investors should track going into 2026 include:

• ETF flows and secondary-market liquidity: Watch net inflows/outflows and bid-ask spreads for major spot crypto ETFs to gauge investor sentiment.
• Regulatory updates: Keep informed on rulemaking that affects eligibility, disclosures and custody expectations.
• Product evolution: Expect more structured products (like multi-asset crypto ETFs or tax-efficient wrappers) as demand diversifies.
• Institutional custody and insurance: Improvements here will underpin broader adoption and investor confidence.

MEXC continues to provide educational resources and market infrastructure that help users navigate a changing landscape. Traders should balance opportunity with appropriate risk controls, position sizing and due diligence, particularly when market volatility intensifies.

Outlook: 2026 and Beyond

Looking ahead, the mainstreaming of regulated crypto funds within large brokerages may catalyze several developments:

• Greater inflows into regulated crypto ETFs from conservative investor segments.
• Expanded product suites that integrate tokenized securities, yield-bearing instruments and diversified crypto baskets.
• Heightened competition among service providers to deliver secure, low-cost custody and settlement solutions.
• Continued importance of clear regulatory frameworks to sustain investor protection and market stability.

While price volatility and macro uncertainty will persist, infrastructure and policy progress in 2024–2025 set the stage for broader institutional engagement. The recent policy reversal by a leading asset manager underscores that combination of client demand, operational readiness and regulatory clarity can reshape long-held stances.

Practical Steps for Investors

Investors considering exposure to regulated crypto funds through mainstream brokerages should:

• Assess fund fundamentals: holdings, fee structure, index methodology and custodian creditworthiness.
• Understand account implications: suitability for retirement accounts, tax treatment and reporting requirements.
• Use proven risk-management practices: diversification, position limits and stop-loss strategies where appropriate.
• Stay informed: monitor regulatory changes and service-provider disclosures that affect fund operations.

By combining rigorous due diligence with a clear investment plan, investors can evaluate whether regulated crypto funds fit their long-term objectives.

Conclusion

The decision by a major US asset manager to permit trading of regulated crypto ETFs and mutual funds is a meaningful development for the crypto ecosystem and traditional finance alike. It reflects evolving investor demand, improved infrastructure and greater regulatory clarity observed through 2024 and 2025.

For market participants, the development signals increased legitimacy for regulated crypto instruments and broader access for everyday investors. As always, prudent risk management and attention to compliance and custody standards remain essential as crypto products continue to integrate into mainstream brokerage platforms.

Disclaimer: This post is a compilation of publicly available information.
MEXC does not verify or guarantee the accuracy of third-party content.
Readers should conduct their own research before making any investment or participation decisions.