The advent of cryptocurrency, specifically Bitcoin, in 2009 was mostly for the computer science community who were fascinated by the code behind it. Fast-forward a little more than a decade and it’s still not as commonplace as stocks, but people are certainly paying more attention. We’ve written about crypto before and how it made a big splash during “the Big Football Game” this year, but the industry just got an even larger endorsement from the President of the United States.
President Biden didn’t tell anyone to go buy crypto or that Americans should be paying attention to the market, but he did sign an executive order to explore official regulation. Many think that regulation is a death knell for an up-and-coming industry, but in this case, the largely symbolic EO acknowledges that it’s not going away.
From Periphery to Presidency
Crypto has been ripe with scams and swindling from the early days and it still persists. While the market has done a good job of self-regulating, it’s clear that to make it a legitimate store of value, the government will have to get involved.
Almost all the major banking institutions have gotten behind cryptocurrencies in one way or another along with major investment firms, so this is a seemingly natural marriage as those industries have been regulated for centuries.
More Investing Options for Clients
While it’s understandable that many of your clients may stay away from crypto simply because of lack of understanding or the novel nature of it, talking to your clients about crypto now and educating them (and maybe yourself in the process) can give you a leg up on competition, all while staying on top of an ever-changing industry. Though it’s important for your clients to understand that it’s mostly just educational at this point and you can’t give them direct advice on this investment. As blockchain ETFs continue to develop, you’ll want to be in the know about the possibilities that exist for you clients.
We view President’s Biden actions toward Crypto as a good thing that merits more discussion and investigation as time goes on, but now we know for certain that even silly sounding blockchain technology like DogeCoin may have some durability in the years to come. Even though it may be a while before you see cryptocurrency as part of your ria portfolio management software, this is a great opportunity to start educating yourself and your clients on an up and coming investment vehicle.