Highlights of CoinDesks Bitcoin for Advisors 2021

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Crypto assets are here to stay. What started out as a niche financial experiment has evolved into a bona fide retail-driven marketplace, attracting interest from financial institutions and professionals alike. Bitcoin, the oldest and most secure crypto asset, has seen its ups and downs as its price has plummeted and apparently skyrocketed while you were having your morning cup of coffee.

On October 6, CoinDesk hosted its second annual Bitcoin for Advisors event to educate financial professionals on all things bitcoin. And while the focus has remained on bitcoin, hence the name, the conference also looked at some of the other parts of the larger crypto ecosystem, giving advisors a new understanding of bitcoin as a class. assets and equipping them with the tools to do more research on their own.

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So why should advisers take a close look at crypto now? Well, according to Tyrone Ross, CEO of Onramp Invests, the answer is simple: If we were going to see the next big increase in crypto assets, it would come from the registered advisor space, its clear adoption by the institution came after massive acceptance.

What do bitcoin and digital assets mean for advisors

And Bitcoin for Advisors’ first keynote speaker corroborated this story.

Ric Edelman, founder of the Digital Assets Council of Financial Professionals, provided a lot of food for thought when discussing bitcoin and what this new digital asset class means for advisors. He said advisers can’t afford to be left behind and they need to educate themselves on this new asset class.

Edelman, who is famous for creating the 1% digital allocation strategy for bitcoin and digital assets, went on to demonstrate how getting advisers a zero hike far outweighed the potential downside.

He went on to note his support for Gary Gensler’s recent actions as chairman of the United States Securities and Exchange Commission, citing Gensler’s experience at MIT and stating: We finally have adult supervision in the room. (although to be clear, it was not a predecessor of Gensler). Edelman appreciated Gensler’s breadth of crypto experience and said he looked forward to the cleanup ahead. Notably, Edelman does not see the lack of regulatory clarity as a reason for advisers to sit on the sidelines, believing they have a sufficient framework to work.

The story continues

While Edelman may have been a difficult act to follow, all of the speakers provided important information for the advisers. Max Schatzow, shareholder of the law firm Stark & ​​Stark, explained compliance and what advisers can and cannot tell their clients, and Morgen Rochard of Origin Wealth Advisers LLC led an excellent discussion on the bitcoin and management practices.

Bitcoin Obstacles and Opportunities

At the top of the hour, Bitcoin for Advisors introduced financial planning nerd Michael Kitces in a fireside chat with Tyrone Ross, covering bitcoin’s obstacles and opportunities. Kitces is not quite completely sold on the bitcoin thesis; he holds a healthy dose of skepticism when it comes to the ecosystem’s oldest digital asset, and for good reason, the issue of holding advisers on how to integrate assets into their systems persists. Unless advisers are able to aggregate crypto held by their clients for tracking and reporting, the conversation remains somewhat dark, Kitces said. Additionally, he predicted that advisers’ investments in crypto assets will much more likely occur in the form of an exchange traded fund (ETF) or separately managed account (SMA) as opposed to trading in individual coins. , believing that advisers prefer more diversified baskets.

Ross pushed back the ETF bit, saying the fees would be quite expensive, and Kitces conceded the cost could be prohibitive. And while Kitces remains skeptical of an asset that grows only because others are investing money in it, he is positioning himself and advising others to stay curious and keep an eye out for anything that continues to unfold. On the one hand, Kitces said he’s certain that advisers, whether they hate or love bitcoin, can no longer afford to ignore the asset.

Perspectives on advisor fees and continuing education

To complete the end of the day, two of the most recognizable names on the advisor side: Grayscale and Coinbase. (Disclosure: Grayscale is owned by Digital Currency Group, the parent company of CoinDesk.) At a new event last year, Grayscale CEO Michael Sonnenshein and Lauren Abendschein, head of institutional sales in the United States at Coinbases, spoke. From the start, Sonnenshein came out forcefully, saying fees shouldn’t be the deciding factor in whether an advisor is breaking into space. He noted that the fees will decrease over time, but advisers shouldn’t let that be the reason they don’t view bitcoin as part of their wallet.

Abendschein accepted the fee and encouraged advisers to continue training in the space, citing the sophisticated tools being introduced to the market as an opportunity, as well as updating investors on the ever-expanding crypto landscape.

Crypto is advancing

And finally, in a closing speech that can only be described as a history lesson integrated with an optimistic forward-looking vision, Dani Fava, Head of Strategic Development at Investnets, reminded advisers of a time and place where only a few Selected establishments were able to trade stocks and how deregulation gave birth to Charles Schwab. She compared this history lesson to the current situation unfolding before our eyes: Crypto is cutting out middlemen, and if advisers don’t adapt, they will be left behind because their clients will continue to build wealth. without them.

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