Tags: Crypto for Advisors

(serggn/GettyImages)

(MoMo Productions/GettyImages)

(Hans-Jurgen Mager/Unsplash)

(Maskot/GettyImages)

(theburtons/GettyImages)

Self-custody, transparency and immediate settlement are just a few ways that crypto could prevent loss of funds.

After the recent collapse of three banks – Silicon Valley Bank, Silvergate Bank and Signature Bank – many pointed fingers at crypto as the cause. But crypto may actually be the solution, not the problem.

Many financial advisors cite lack of intrinsic value as a case against bitcoin. But demand and global adoption, evidenced by bitcoin‘s steadily increasing price, are what they should be paying attention to.

The disconnect between financial advisors and their clients around crypto has become increasingly apparent, given that 37 of advisors personally invested in crypto compared to 83 of their clients that have, according to one 2023 survey.

AI and blockchain could assist in decisions around investments, taxes and insurance, and open up new avenues for income. But financial advisors will still play a key role.

CEO of Digital Asset Research, Doug Schwenk, thinks that vetting crypto exchanges can open doors to more institutional investment.

When crypto winter ends and investment activity blossoms once again in the digital assets space, financial advisors should be prepared to hear a new litany of questions from clients about the risks and opportunities in cryptocurrencies.

Amid a prolonged collapse in asset prices, the digital assets space had a wild 2022. The problems may force regulators’ hands on the crypto space.

Advisors are warned by the Certified Financial Planner Board of Standards (CFP Board) and the Chartered Financial Analyst Institute (CFA Institute) to look before they leap.

If we’re looking ahead, let’s really look ahead.

While the FTX debacle has many Ponzi-like characteristics, most cryptocurrencies do not resemble the infamous schemes.