This news service recently interviewed the wealth management firm Abra Capital Management about the work it does around digital assets.

An RIA says the business of working with HNW individuals, trusts and family offices over tapping into digital assets remains brisk, suggesting continued wealth sector demand even at a time when price action can be volatile.

The way that digital assets – a broad term spanning cryptocurrencies such as bitcoin through to tokens – can form part of HNW portfolios is what drives Abra Capital Management, an RIA. It provides a suite of digital assets and wealth advisory solutions. The RIA is part of the Abra global platform for digital asset prime services and wealth management. Abra lists investors such as American Express, First Round, HCM Capital, Carthona Capital, Liberty City Ventures, MESA Ventures, AVP, and Arbor. 

Among the senior figures at Abra besides Marissa Kim, head of asset management, are its founder and CEO, Bill Barhydt; Bob Wallden, head of trading; Daryl Puryear, chief technology officer; and Willie Wang, vice president, engineering.

The world of digital assets continues to evolve, with even US President Donald Trump – controversially – getting into a self-branded act with his TRUMP token.

Abra, which started in 2016, began with mainly HNW individuals and retail clients. "The business has developed a more institutional approach over the subsequent period,” Kim told this news service in a recent call. The firm offers a variety of different products, from basic custody solutions to yield and borrow products. Many of the firm’s clients borrow against their bitcoin.

Abra offers its solutions to HNWs, advisors, trust and family offices via a separately managed accounts model where a client retains title and ownership over the assets; they are independently variable on the blockchain.

And with concerns about persistent domestic US inflation, and high levels of public debt being so prevalent, the attractions of cryptocurrencies – in contrast to fiat currencies such as the dollar – retain an appeal, Kim said. 

“Most people are seeing it as a safe haven asset, a must-have, not a nice-to-have. It is kind of a hedge against global instability,” Kim continued. Some people regard bitcoin as a speculative asset, some as a safe haven, she said. “It can be considered a safe-haven asset if your timeframe is very long." 

“There is a general feeling that inflation is going to continue; bitcoin is viewed by some as a potential hedge against dollar debasement,” she said. 

Momentum
Momentum continues. Earlier in April, the Securities and Exchange Commission said that certain dollar-backed “stablecoins” that can be redeemed at a one-to-one ratio aren’t deemed securities under US federal law, and issuers and intermediaries for these entities that comply with the definition are freed from certain requirements. Stablecoins are backed by a specified asset or basket of assets which they use to maintain a stable value against that asset. This is usually a country’s currency, such as the dollar. This makes stablecoins different from crypto assets such as bitcoin which tend not to have assets as backing and so, are more volatile.

As far as bitcoin the most well-known cryptocurrency is concerned, the currency is down 5.2 per cent so far in 2025 – feeling the downdraft impact of wider equity market retreats – but up a whopping 39 per cent over 12 months as of yesterday, and up an astonishing 884 per cent over the past five years, completely overshadowing mainstream equities. (And that performance, remember, happened during a period of a pandemic, war and political upheaval.)

A survey of family offices around the world by BNY Mellon Wealth Management, published in 2022, found that 77 per cent of them have some interest or involvement in cryptocurrencies. Knight Frank, in its annual wealth report, also published that year, said 60 per cent of respondents to its survey cited blockchain technology as an increasing opportunity. It was found that clients ask for 1 to 5 per cent of their portfolios to be in cryptos. The report’s authors noted that “we are seeing a shift within the banking industry to accepting and managing crypto assets, allowing them to be used as collateral and converting crypto into fiat. It is not a widely marketed service, but banks recognize that the younger generation is going to be using crypto as a currency.”

Allocations don't have to be large
Abra’s Kim argued that digital assets don’t need to be a large allocation in a portfolio. For example, an individual or institution can have a modest allocation – such as 1 to 5 per cent – in bitcoin, allowing them to retain exposure to the upside and some level of purchasing power parity, Kim said.

Wealthier clients can afford to take a relatively longer view, she said.  

“HNW investors tend to have higher risk approaches, as they have futuristic looking views and often have invested in assets like technology and venture capital previously, she said.  Family offices can potentially improve the risk-adjusted returns of portfolios by holding digital assets,” Kim continued.

What concerns should investors have? 

Security is key and most investors will want to use some kind of custodian, Kim said. In general, self-custody is not a good idea, she said. “Generally, it is a better idea to hold bitcoin with a custodian; there are not many of us at the moment.”

Kim noted that bitcoin can provide collateral for loans; a loan-to-value (LTV) ratio of 50 per cent or lower is a “relatively conservative approach.” Clients using bitcoin in this way will be notified if the LTV is more than 65 per cent; this could trigger a margin call. Abra aims to keep LTVs low, due to market volatility, Kim said. 

She said that some investors, including institutional ones such as pensions, may prefer to hold exposures via exchange-traded funds.