Envestnet | Tamarac, which provides client-management software used by more than 1,000 Registered Investment Advisors (RIA) managing over $1.2 trillion in assets, announced two partnerships this week intended to ease hurdles to more mainstream adoption of cryptocurrencies among wealthy investors.
The deals involve cryptocurrency exchange Gemini and Flourish, a fintech company owned by 171-year-old insurance giant MassMutual, plugging into Envestnet’s RIA software known as Tamarac. This is the latest doorway to open for RIAs and accredited investors that could lead to broader crypto investing. Last month, investment management giant Franklin Templeton announced plans to offer digital asset strategies to wealth managers. Earlier this week, Fidelity launched its first Ethereum-focused index fund.
Financial advisers managing the assets of individual and institutional investors have shown an increased willingness to offer clients access to cryptocurrencies. However, potential hurdles include the difficulty of offering an emerging asset class within battle-tested, institutional-grade technological infrastructures. Integrations can bring crypto to the advisers on their home field.
“Many of these advisers are interested in offering crypto to their clients, but they have highly specific needs – from regulatory and compliance considerations to specific tech functionality to integrations into their key reporting systems,” Flourish President Ben Cruikshank told CoinDesk in an email. “As a result, they can't use the big retail exchanges.”
Through the new integration with Gemini, advisers and clients can now view their crypto portfolios, performance data and billing information from within the Tamarac dashboard that RIAs are already using. This comes through Gemini BITRIA, a system Gemini acquired in January to offer a combination of adviser-focused services, including asset custody, liquidity, trading, portfolio construction and reporting.
"Gemini has built an ecosystem around the BITRIA platform that serves both wealth and asset managers. This approach means that advisers who participate in the Envestnet | Tamarac ecosystem will enjoy a much cleaner, more streamlined workflow,” Daniel Eyre, head of Gemini BITRA, told CoinDesk in an email.
The Flourish integration brings Flourish Crypto’s data into the general workflow for Tamarac users, allowing advisers to handle crypto the same way as any other asset class. Features include portfolio management, reporting and planning support, and billing.
MassMutual acquired Flourish in February 2021 following a $100 million investment in bitcoin and the purchase of a $5 million equity stake in custodian NYDIG in December 2020. Flourish, which works exclusively with independent RIAs, launched Flourish Crypto with custodian Paxos as a way for advisers and their clients to invest in bitcoin.
“Envestnet | Tamarac is one of the largest adviser-centric reporting software platforms, used by thousands of advisers. By launching this integration, crypto investing has now become one huge step more accessible to RIAs, giving them access to crypto just like any other asset class or investment,” explained Cruikshank.