TLDR
- Hargreaves Lansdown warns Bitcoin isn’t an asset class for portfolio growth.
- Hargreaves Lansdown plans crypto ETN launch in early 2026 with risk checks.
- FCA lifts crypto ETN ban, allowing Hargreaves Lansdown to offer products.
- Hargreaves Lansdown limits crypto exposure to 10% of client portfolios.
Hargreaves Lansdown, one of the UK’s leading retail investment platforms, has made a bold statement regarding Bitcoin, calling it “not an asset class.” The company has warned clients not to view Bitcoin as a reliable investment option for long-term growth or income. This comes as the firm plans to introduce crypto exchange-traded note (ETN) products to its platform in 2026, but with strict risk assessments and regulatory measures in place.
Hargreaves Lansdown’s Caution on Bitcoin
Hargreaves Lansdown has made it clear that it does not consider Bitcoin to be an asset class. Despite Bitcoin’s history of price gains, the firm argues that the cryptocurrency does not meet the fundamental criteria required for inclusion in an investment portfolio aimed at growth or income.
According to the platform, Bitcoin’s price history is characterized by significant fluctuations, including periods of extreme losses, making it difficult to assess its long-term value.
The company further states that the lack of intrinsic characteristics in Bitcoin means it should not be relied upon to achieve financial goals. As a result, Hargreaves Lansdown has advised its clients against including Bitcoin as a core part of their investment strategies.
Regulatory Environment and Plans for Crypto ETNs
Despite its reservations about Bitcoin, Hargreaves Lansdown plans to offer crypto-related products to clients starting in early 2026. This will include exchange-traded notes (ETNs) that are physically backed by Bitcoin and Ether. These products will be available only to those clients who meet a risk assessment requirement, ensuring that they understand the potential risks associated with cryptocurrency investments.
The UK’s Financial Conduct Authority (FCA) recently lifted its ban on crypto ETNs for retail investors, allowing companies like Hargreaves Lansdown to enter the market. However, there are strict conditions attached to this move.
The FCA now only allows crypto ETNs that are physically backed by Bitcoin or Ether, meaning that the underlying assets are held in reserve. These products will also be listed on a Recognised Investment Exchange (RIE), such as the London Stock Exchange, in line with traditional securities regulations.
Risk Assessment and Exposure Limits
Before offering these crypto products, Hargreaves Lansdown plans to implement a “balanced client journey” that includes a thorough risk assessment. This will ensure that only those who fully understand the risks involved will be able to invest in crypto ETNs.
Furthermore, the FCA’s regulations will limit clients’ exposure to cryptocurrency investments to a maximum of 10% of their portfolio. This rule aims to protect retail investors from excessive risk, considering the volatility of the crypto market.
Hargreaves Lansdown is making efforts to educate its clients about the risks of investing in cryptocurrencies. The platform emphasized that, although some investors may seek speculative exposure, Bitcoin should not be relied upon as a stable source of growth or income. This approach reflects the firm’s commitment to ensuring that its customers are making informed decisions.
Future Outlook for Crypto Products
Hargreaves Lansdown’s plans to offer crypto ETNs represent a significant shift in the UK investment landscape. However, the firm remains cautious in its approach, ensuring that it complies with the new regulatory standards set by the FCA.
While it acknowledges that some clients may still want to invest in cryptocurrency, the company stresses that these investments should be made with full awareness of the associated risks.
The firm’s decision to limit crypto exposure to a small portion of a client’s portfolio aligns with broader trends in the market, where regulatory bodies are taking steps to provide greater investor protection in the volatile crypto space. By offering physically backed crypto ETNs, Hargreaves Lansdown aims to provide a more secure way for investors to gain exposure to digital assets while minimizing risk.
