Looking for the next big thing? It’s already here and it’s still early. I’m talking about blockchain technology and digital assets.
These innovations will have the greatest impact on global commerce since the invention of the internet itself, with huge implications for national economies, personal careers and wealth creation.
But even though this asset class is more than 10 years old, most financial professionals — probably including you — don’t realize this.
That’s my conclusion after studying and engaging in this new asset class since 2012. I get why most financial professionals aren’t engaged in this asset class. Most know little about it. Prices have experienced extreme volatility. There’s no way to apply traditional valuation methodologies. No one is accountable. Fads and frauds permeate the marketplace. Governments threaten bans or restrictions. And there’s no clear, easy way to manage client investments in digital assets — or to get paid on that AUM. No wonder most advisers and their firms have spent the past decade waiving off client inquiries.
And yet, digital assets represent a trillion-dollar-plus global market, the fastest to a trillion in history. And still only about 100 million people worldwide — less than 1.5% of the population — own digital assets. Greater adoption will lead to higher prices, and further innovations are about to upend every aspect of finance on the planet. I’m talking about DeFi (decentralized finance), DAO (distributed autonomous organizations), NFTs (non-fungible tokens) and CBDCs (central bank digital currencies). Some wonder that digital assets have already produced billionaires — and why the Association of Governing Boards of Universities and Colleges says they are projected to produce the world’s first trillionaires sometime this decade. Yup, this thing is just getting started.
To date, the financial services industry has been largely uninvolved, but those days are over — mostly because you no longer have a choice. Some 82% of clients now expect their advisers to be knowledgeable about Bitcoin and 62% say they would switch advisers if theirs can’t give them advice about it, according to NYDIG’s April survey. Today, you either get engaged or you risk losing clients and assets.
That’s why I created the RIA Digital Assets Council in 2018. Back then, our focus was on registered investment advisers. But over the past year, interest and demand have extended much further. We’re now getting requests for help from every sector of the financial services industry, as firms seek to establish their strategies for adding digital assets to client portfolios, develop products, market their offerings and train their advisers and home office staff.
So, our name is now the Digital Assets Council of Financial Professionals. This reflects our broader charter to serve every financial services company — including broker-dealers, wirehouses, institutional investors, family offices, trust companies, banks and insurance companies around the world — and all financial advisers, whether you’re licensed by the Securities and Exchange Commission, the Financial Industry Regulatory Authority Inc. or state insurance regulators.
In addition to webinars and conferences, DACFP offers the Certificate in Blockchain and Digital Assets, an 11-module online self-study program featuring 13 CE credits and a world-class faculty of experts in the blockchain, digital asset and financial advisory fields. Students obtain proficiency in key practice management areas pertaining to digital assets, including tax, regulatory and compliance issues in addition to portfolio construction and management. Most important, financial professionals learn how to explain this new asset class to investors and clients. Enrollment discounts are provided by many companies and organizations in the financial services industry.
DACFP is the education partner for blockchain and digital assets for the Financial Planning Association, the CFP Board, National Association of Personal Financial Advisors, XY Planning Network, QUAD-A, the Money Management Institute and the Investment Advisers Association.
DACFP also works closely with the New York Institute of Finance, many fund companies, including Fidelity Investments, Global X and Invesco, and premier service providers such as Orion.
We’re also very proud to be partnering with InvestmentNews. Together, we’ll be providing subscribers with content and educational opportunities to increase your knowledge about blockchain and digital assets, and access to the product and service providers in that ecosystem, so you can give investors the advice, products and services they need.
I encourage you to learn more at DACFP.com. You, your firm and your clients will all benefit.
Ric Edelman is founder of the Digital Assets Council of Financial Professionals.
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Andrew is half-human, half-gamer. He’s also a science fiction author writing for BleeBot.