Investment advisers need to do enough research and adequately familiarize themselves with blockchain technology. This is according to Lex Sokolin, the Global Director of fintech strategy at Autonomous Research. According to Sokolin, investors will always buy bitcoin regardless of the whether the advisor approves of it or not.
Need to exercise caution
Sokolin advises that given the volatile nature of the digital markets, it is prudent for investors to spread their portfolio instead of allocating all their money in one investment tool. He suggests that cryptocurencies add a better alternative to the general allocation.
The traditional mainstream financial system has for a long time has been accommodative of the digital currency industry. In addition, many governments and financial regulators have been very skeptical about virtual currencies. Their adoption has been varying in different countries. Many big Wall Street banks like Merrill Lynch do not allow their financial advisors and analysts to invest in Bitcoin-related instruments for their clients.
The mainstream financial sector remains dismissive of the crypto space
Players in the mainstream financial industry have put up a tough war against virtual currencies. Jamie Dimon, the chairman of JPMorgan Chase & Co. (NYSE:JPM) recently called bitcoin a “fraud.” Tim Buckley, the CEO of Vanguard was recently quoted saying that “You will never see a fund from Vanguard on bitcoin.”
However, the crypto space may soon go over the backlash from the mainstream financial sector. Recently, the New York Stock Exchange announced that it may soon allow investors to swap contracts in BTC. In Japan, Nomura, the largest global investment bank has announced that it has launched a digital asset custody solution targeting institutional investors.
Blockchain is also finding its way in some of the world’s leading tech companies. This week, Amazon Web Services, the cloud computing arm of the tech giant announced that it has formed a partnership with ConsenSys’ blockchain startup to offer clients with simplified blockchain cloud platforms.
According to Sokolin, many advisor are so dismissive of digital currencies and many see it falling apart. He added that because of this mentality, many do not take time to learn about it. He urges that advisors should take time and grasp the basics on the subject of cryptocurencies and blockchain technology.