New Huo Research says traditional trust companies are refusing a class of new clients that most needs professional wealth-structuring services. The article, citing a recent Financial Times report, says some conventional trust institutions have declined to set up offshore trusts for crypto-rich clients on the grounds that the assets are too volatile, on-chain transactions are hard to review, and digital assets are difficult to custody. In some cases, clients were asked to liquidate their holdings first and enter the trust structure with fiat instead.
According to the article, that stance exposes a structural gap between legacy trust services and digital-asset wealth. With spot ETFs, on-chain analytics tools, and institutional custody infrastructure becoming more established, the question is no longer whether crypto assets are fit for trust structures. The question, it says, is whether trustees can complete due diligence, custody, segregation, and inheritance planning for digital assets without weakening compliance standards.
Three objections from traditional trust providers
The piece says traditional trust institutions usually frame their discomfort with crypto around three points: volatility, opacity, and custody difficulty. In New Huo Research's view, that narrative may have sounded complete in 2017 or 2022, but it is much harder to sustain now.
On allocation, the article says spot Bitcoin ETFs changed the conversation. Digital assets are no longer discussed only as a risk preference inside the crypto market. They have entered allocation discussions involving pensions, registered investment advisers, family offices, and even some sovereign portfolios. Citing HSBC-related material, the article says multiple traditional financial institutions, including HSBC, Charles Schwab, and Fidelity, commonly recommend a 1% to 2% base allocation within diversified portfolios, treating digital assets as a non-correlated hedge. It also says that with listed companies adopting Digital Asset Treasury strategies, crypto assets have moved beyond a pure retail speculation profile and into portfolio assets constrained by corporate governance and audit frameworks.
On transparency, the article argues that describing on-chain assets as opaque reflects a misunderstanding of distributed ledgers. Public and tamper-resistant on-chain transaction records, it says, offer deeper visibility than most traditional offshore accounts. Tools can quantify where assets were withdrawn from, whether funds passed through mixers or sanctioned addresses, and whether cross-chain routes contain risk gaps. Those checks can then be cross-referenced with know-your-customer reviews, tax filings, and proof of wallet control.
From that perspective, New Huo Research says the industry's shortcoming is not that due diligence cannot be done. The real problem is that many traditional trustees have not built a dual review framework that combines anti-money-laundering checks for assets through KYT with on-chain tracing.
The article also points to infrastructure. Tokenization of real-world assets, or RWA, is pushing Treasuries, money market funds, and even private funds toward on-chain settlement. Citing RWA.xyz, it says tokenized real-world assets currently stand at $39 billion, while tokenized securities are also advancing quickly with support from multiple institutions. At the same time, multisignature arrangements, hot-cold segregation, compliant custody, and digital inheritance tools have moved from concepts into mature products.
The article says it is a category error to treat private key loss or isolated exchange failures as proof that the asset class itself is fundamentally flawed. In its telling, that amounts to turning a trustee's own infrastructure limitations into a judgment on the assets.
The fault line is not the asset class but outdated risk controls
New Huo Research says the core contradiction in the trust industry is not a lack of high-net-worth clients. It is that trustees are using rigid risk-control standards that no longer match the way wealth is being formed and transferred.
In the traditional framework, the article says, volatility is treated as uncontrollability, on-chain activity as unauditable, and private keys as uncustodiable. The easiest response is therefore a blanket refusal. That may ease short-term compliance anxiety, it argues, but intergenerational transfer of new wealth will not stop. The result is that a tokenized market worth trillions will be left to institutions that moved earlier to build compliance due diligence and custody capabilities.
The article highlights two representative types of demand. One comes from the next generation in traditional families, who are starting to ask for part of a trust portfolio to be allocated to digital assets in order to reduce exposure to fiat depreciation. The other comes from first-generation crypto-native entrepreneurs whose wealth has expanded quickly and who need legal structures to guard against marital disputes, debt liabilities, and cross-border tax risks while still keeping strategic control over the underlying assets.
Against that backdrop, the article says traditional trust firms often offer a blunt solution: liquidate everything first, then contribute fiat to the trust. In New Huo Research's view, that wipes out the client's intended return profile and long-term allocation plan, while also pushing tax burdens that might have been deferred within the trust structure back onto the individual account.
Crypto clients are asking for institutional adaptation, not relaxed standards
The article says ultra-high-net-worth crypto clients are not simply looking for someone to hold coins on their behalf. They face a knot of practical problems. Self-custody can resemble carrying bearer cash. Clients may want trading and investment flexibility while also having to prove clean sources of funds and comply with frameworks such as CARF and CRS2.0. Assets held in an individual's own name may offer little protection against divorce claims, debt collection, or legal freezes. Traditional wills, the article says, are often ineffective when private keys, on-chain accounts, and cross-border tax issues are involved, and probate can be costly, contentious, and in some cases leave heirs unaware that the assets even exist.
According to New Huo Research, a workable digital-asset family trust has to answer at least four questions:
- How assets move from self-custody into institutional custody, replacing personal private-key risk with multisignature controls, hot-cold segregation, and licensed custody accounts.
- How control and compliance can coexist, for example through reserved-powers trusts that let settlors retain investment instruction rights or account operation rights during their lifetime while transferring legal ownership into the trust.
- How assets can be segregated as independent trust property, creating a legal firewall against marital disputes, debt claims, and litigation.
- How inheritance can avoid vague succession procedures by using trust deeds and letters of wishes to enable private, staged, event-triggered intergenerational distributions.
The article says that means trustees cannot act only as document signers. They need to coordinate lawyers, tax advisers, custody, trading access, and investment management within one operating framework, with on-chain tracing built into standard due-diligence procedures rather than added later as a patch.
Licensed digital-asset trust providers are no longer theoretical
The market is starting to split, the article says. The withdrawal of mainstream traditional trustees does not mean the demand is gone. It means the business is moving to institutions that already built the underlying infrastructure.
Using New Huo Group (HKEX1611) as an example, the article says the firm places digital-asset family trusts at the end of a closed loop covering trading, custody, investment, and inheritance. Its central aim, according to the piece, is to convert digital assets held as personal property by ultra-high-net-worth crypto clients into family wealth that can be transferred across generations in line with the settlor's wishes, in a compliant and low-friction way.
Structurally, the article says these solutions do not rely on a single template. For clients with a clear distribution plan who still want a high degree of trading autonomy, a reserved-powers trust such as a dual-layer BVI structure can be used, allowing the settlor to control the lower-level company or investment decisions while children receive benefits in stages tied to age, education, or specified events. For clients who trade less frequently but still want to issue buy and sell instructions, the settlor may act as investment manager, with the trustee reviewing and executing the instructions. For families that have not settled on final distributions and care more about asset safety and professional allocation, discretionary trusts may be used, with a licensed asset manager serving as investment manager and a letter of wishes guiding the trustee's discretion.
The article stresses that such structures depend on underlying licenses. It says this is not a marketing label but a regulated business constrained by trust licenses, asset-management licenses, and cross-border compliance reporting. To judge whether a trustee can actually deliver, the article says attention should be paid to whether the institution has completed institutional-grade cold, warm, and hot custody arrangements, whether audited financial statements support the accounting treatment of on-chain assets, and whether behavioral graph analysis for on-chain activity has been made a routine anti-money-laundering tool. It adds that New Huo Trust, under New Huo Group (HKEX1611), holds a Hong Kong TCSP license and focuses on compliant virtual-asset custody and trust services.
The article's conclusion: the cost of this stance will show up in future AUM
In the final section, New Huo Research argues that the problem with traditional trust providers is not open hostility toward clients. It is a more concealed form of arrogance: using their own unupgraded capability limits to decide whether a new asset class is fit for inheritance planning. The article says that when Wall Street has already written Bitcoin into model portfolios, when on-chain ledgers can be more auditable than some offshore accounts, and when tokenization is moving Treasuries and funds onto the same settlement rails, saying "we do not touch crypto" is no longer a sign of prudence. It is a way of shutting out future clients.
New Huo Research says the next generation of high-net-worth crypto clients is not asking for lower compliance standards. It wants a compliance system that understands the logic of the on-chain world. Those clients can accept strict source-of-funds reviews, and may even welcome diligence that cuts deeper than what is common for traditional offshore accounts. What they cannot accept, the article says, is being told that this kind of wealth does not belong inside a trust simply because the review capability is missing.
The piece ends by saying that wealth migration will not wait for the market to catch up intellectually. Institutions that can combine compliance due diligence, institutional custody, investment management, and legal title structuring into one coordinated service model will be better placed to win over high-net-worth clients who are being turned away by traditional firms. Those that remain attached to older standards, it says, risk losing their foothold in the digital era.
