45% of US Investors Eye Crypto and Alts via ETFs, Survey Suggests

• 45% of US investors seek non-traditional assets like crypto and gold for better diversification.

• Two-thirds believe stocks and bonds alone are insufficient for modern portfolios.

• Over $1 trillion has flowed into US ETFs in 2025, with significant portions targeting crypto and commodity funds per State Street data.

Discover how US investors are embracing alternative investments like crypto in 2025. Learn key trends, ETF strategies, and expert advice to diversify your portfolio effectively today.

What Are Alternative Investments and Why Are US Investors Turning to Them?

Alternative investments encompass assets outside conventional stocks, bonds, and cash, such as cryptocurrency, commodities, real estate, private equity, and hedge funds. According to a Charles Schwab survey released in 2025, 45% of US investors are eager to allocate funds to these options, driven by the limitations of traditional portfolios. This trend signals a broader reevaluation of investment strategies, particularly among younger generations seeking higher growth potential in a volatile economy.

How Are ETFs Making Alternative Investments More Accessible?

Exchange-traded funds (ETFs) are revolutionizing access to alternative investments by providing a liquid, straightforward entry point into complex assets like cryptocurrency and gold. State Street Investment Management reports that inflows into US-based ETFs have surpassed $1 trillion in 2025, with a notable surge in funds tracking crypto and commodities, as highlighted in analyses from financial outlets. ETFs eliminate many barriers, such as long lock-up periods associated with direct private investments, allowing investors to trade shares daily, including after-hours, for greater flexibility.

Cathy Curtis, CEO of Curtis Financial Planning, emphasizes the efficiency of ETFs in navigating regulatory hurdles. “These private investments often involve multi-year commitments, restricted redemption options, or delays tied to asset liquidation,” she notes. By contrast, ETFs democratize exposure to the same underlying assets without such constraints, making them ideal for retail investors. However, Curtis advises moderation, recommending that those with smaller portfolios limit alternatives to under 5% of holdings, while larger investors can allocate up to 10-15% to maintain balance and mitigate risks.

This accessibility is particularly evident in the crypto space, where spot Bitcoin and Ethereum ETFs have seen explosive growth. These vehicles enable investors to gain cryptocurrency exposure without managing wallets or dealing with exchange complexities, appealing to a demographic increasingly comfortable with digital assets. Data from Morningstar Direct underscores the enduring strength of traditional markets but also illustrates how alternatives can complement them, fostering more resilient portfolios in uncertain times.

Frequently Asked Questions

What Percentage of US Investors Are Interested in Crypto and Other Alternatives?

The Charles Schwab survey from 2025 reveals that 45% of US investors, including a diverse sample of 2,000 adults, 200 Gen Z individuals, and 200 crypto enthusiasts, are keen on non-traditional assets like cryptocurrency, gold, private equity, and real estate. This interest stems from a perception that traditional stocks and bonds fall short in delivering adequate diversification and returns in today’s economy.

Are ETFs a Safe Way to Invest in Cryptocurrency for Beginners?

Yes, ETFs offer a beginner-friendly path to cryptocurrency investment by providing regulated, liquid access without the need for direct ownership of digital assets. They trade like stocks on major exchanges, allowing easy buying and selling while benefiting from professional management. Experts like Cathy Curtis recommend starting small, keeping crypto ETF allocations modest to align with overall risk tolerance and portfolio goals.

Key Takeaways

• Shift to Alternatives: Nearly half of US investors are diversifying beyond stocks and bonds, with crypto leading the charge for innovation and potential upside.
• ETF Boom: Over $1 trillion in ETF inflows this year highlights the appeal of accessible vehicles for commodities and crypto, reducing traditional barriers like illiquidity.
• Balanced Approach: Advisors urge limiting alternatives to 5-15% of portfolios and avoiding hype-driven decisions to ensure long-term financial health.

Conclusion

In summary, the rising interest in alternative investments among US investors, fueled by cryptocurrency’s prominence and ETF innovations, marks a pivotal evolution in wealth management strategies. As regulatory changes from bodies like the SEC further ease access, particularly for retirement plans, opportunities abound for thoughtful diversification. Yet, as Vanguard’s Andy Reed warns, steering clear of fleeting trends remains essential for sustainable growth. Investors are encouraged to consult financial advisors and explore balanced options to navigate this dynamic landscape effectively in 2025 and beyond.

The Charles Schwab survey underscores a generational pivot, with two-thirds of respondents viewing traditional assets as inadequate for future needs. This sentiment, dubbed “financial nihilism” by some experts, reflects disillusionment with conventional models amid economic pressures like inflation and market volatility. Younger investors, particularly Gen Z, are at the forefront, prioritizing assets that promise not just returns but also alignment with personal values, such as sustainable or tech-driven opportunities exemplified by blockchain-based cryptocurrencies.

Alternative investments, often abbreviated as “alts,” span a wide spectrum. Commodities like gold serve as inflation hedges, while real estate partnerships offer steady income streams. Private equity and hedge funds target high-growth ventures, but their opacity and illiquidity deter many. Cryptocurrency stands out for its 24/7 trading and decentralized nature, drawing parallels to early internet stocks in terms of disruptive potential. However, volatility remains a hallmark—Bitcoin’s price swings can exceed 10% in a single day, necessitating robust risk management.

ETFs address these challenges head-on. By pooling investor funds into baskets that mirror alternative asset performance, they provide instant diversification. For instance, a crypto ETF might hold a mix of top digital currencies, shielding individual investors from single-asset risks. State Street’s figures on ETF inflows not only validate this trend but also point to institutional confidence, as pension funds and endowments increasingly incorporate alts for enhanced returns. CNBC reports from analysts corroborate that gold and crypto ETFs have captured a disproportionate share of these funds, signaling market maturity.

Government actions are accelerating this momentum. The executive order signed by former President Donald Trump in August 2025 expands alt offerings in workplace retirement plans, potentially injecting billions into the sector. Concurrently, SEC approvals for spot crypto ETFs have streamlined launches, reducing approval timelines from years to months. These developments lower the entry bar, enabling everyday savers to participate without specialized knowledge or high minimums that once gated private markets.

Despite the enthusiasm, cautionary voices prevail. Andy Reed of Vanguard highlights the perils of behavioral biases, where media buzz prompts impulsive allocations. Historical data from Morningstar Direct illustrates the power of patience: a $1,000 investment in the S&P 500 from February 1970 would have grown to over $379,000 by 2025, adjusted for dividends. Even post-2020, that same amount ballooned to $2,200 by October, outpacing many alts during recovery phases. This longevity reinforces the adage from Curtis: “Boring investing still works,” suggesting alts should enhance, not replace, core holdings.

Portfolio construction emerges as a critical consideration. Financial planners advocate for a tiered approach—core allocations to equities and fixed income for stability, satellites of alts for growth. For crypto specifically, dollar-cost averaging via ETFs mitigates timing risks, allowing gradual entry regardless of market peaks. Tax implications also factor in; while ETFs often qualify for favorable treatment, direct crypto holdings can trigger complex capital gains rules, underscoring the value of structured products.

Broader economic context amplifies these shifts. Persistent inflation erodes bond yields, pushing capital toward tangibles like gold and digital gold equivalents in Bitcoin. Geopolitical tensions further boost commodities, while technological advancements propel crypto adoption. A Charles Schwab breakdown shows crypto investors in the survey sample as particularly bullish, with 70% planning increased exposure, blending optimism with pragmatism.

Looking ahead, the integration of alts into mainstream finance promises a more inclusive ecosystem. As barriers dissolve, education becomes paramount—investors must grasp not just opportunities but inherent risks, from regulatory reversals to cyber vulnerabilities in crypto. By leveraging expert insights and data-driven decisions, US investors can harness this wave without upending foundational strategies.