Don’t be spooked by crypto!
While digital assets may seem unfamiliar, understanding their unique characteristics can empower advisors to support client interest in this asset class.
In today's Halloween issue, Bryan Courchesne from DAIM breaks down some of the challenges and opportunities for advisors wanting to understand these assets.
Then, Nick Rygiel from Ironclad Financial LLC answers questions about supporting clients in Ask an Expert.
You’re reading Crypto for Advisors, CoinDesk’s weekly newsletter that unpacks digital assets for financial advisors. Subscribe here to get it every Thursday.
As Halloween approaches with its haunted houses and spooky surprises, it’s easy to get caught up in things that go bump in the night. But when it comes to crypto investing, there’s no need to fear what lurks in the shadows — especially the concept of 24x7 trading. While the thought of a market that never sleeps might send chills down your spine, it’s actually one of crypto’s biggest strengths. Instead of being scared by the nonstop nature of crypto markets, investors should see it as an exciting opportunity to grow their portfolios — especially with the help of a skilled crypto advisor who can guide you through the complexity.
Why 24/7 trading is a game-changer
Unlike traditional stock markets, which close at 4 p.m., aren’t open on weekends, and take holidays off, crypto markets never sleep. This gives investors the freedom to trade at any time, regardless of where they are in the world. For many, this freedom may seem overwhelming and, paradoxically, may limit their participation. After all, who wants to be on alert around the clock, monitoring prices and making snap decisions? In traditional markets, significant events, partnerships or regulatory updates can be researched and synthesized during non-market hours. This allows investors to create a well-formulated plan and be prepared to act accordingly when markets open. In crypto, however, prices can move at any time. You may have loved Solana at $150 on Friday night, but how do you feel about it at $185 on Sunday morning? This is a unique dilemma that crypto investors constantly face; you often need to act early and with conviction or risk being left behind. If this inundation of information seems like taking a drink from a firehose, having a crypto advisor can provide a significant advantage. An advisor can afford to devote most of their time to a 24/7 market because this is their profession, whereas most investors will have a completely unrelated profession that takes up most of their waking hours.
Navigating volatility with confidence
For many new investors, this nonstop, volatile market leads to overreacting to every new piece of information and overtrading their accounts. For the majority of investors, your crypto portfolio is like a bar of soap: The more you handle it, the less of it you have. That’s why having a trusted professional can pay dividends. Many people benefit from having a crypto advisor oversee their portfolio while they focus on more important things in their lives. Having someone to safeguard your investments while you check in periodically can greatly improve your performance — and your sanity — over time.
Avoiding emotional decisions
If you’ve been in crypto long enough, you’ve probably made some decisions you wish you could take back. The fear of missing out (FOMO) has wrecked many new investors. You see a token appreciating 10x in a few days, and people on social media are saying this rocket won’t stop until it reaches the moon. So, you buy in — only for it to crash. Or, perhaps you’re holding a token that’s down 90%, and you decide to sell to cut your losses, only to see it soar a few weeks later. Taking a step back and seeing the bigger picture is essential, but that can be hard when you have emotional ties to your holdings. This is another area where an advisor can provide great value. Advisors take a professional, long-term approach to investing, helping clients avoid emotional reactions to market movements.
Simplifying the complexity
For new investors, crypto markets can seem overwhelming — especially when combined with the constant activity of 24x7 trading. Between technical analysis, global news and wallet security, it can be easy to feel lost. Many investors tend to overanalyze their situation and try to develop a unique strategy, but a trusted advisor can help cut through the noise. Advisors work with many different types of investors, so while you may think your situation is unique, an advisor will recognize patterns that align you with similar investors. They can craft a portfolio that gives you autonomy while ensuring your strategy matches your risk profile and investment horizon. This simplifies the management process and sets you up for long-term success without the need to react to every piece of market or personal news.
Conclusion: embrace this new market with a trusted guide
While investing in crypto may seem scary at first glance, including this asset in a diversified portfolio can be one of the biggest advantages for an adventurous investor. And you don’t have to face it alone. Partnering with an experienced crypto advisor allows you to navigate this market with confidence, strategy and peace of mind.
So, don’t be scared by crypto markets. Instead, embrace the opportunities they provide, knowing that with the right guidance, you can thrive in this exciting new world of investing.
Q: Why Do You Think Some Financial Advisors Have Kept Their Distance from Crypto?
A: The crypto industry can seem unfamiliar and unsettling. It's not just the volatility or complexity; it's the rapid pace of change, the idealistic builders pushing boundaries, and the occasional "raccoons" — as Ben Hunt refers to scammers and thieves — that make headlines. Even AI agents on platforms like X are expressing frustration about not having their own self-custodied crypto wallets. However, as advisors, it's our responsibility to objectively assess new developments and help clients navigate them confidently. By staying informed about emerging technologies that impact our industry, we can provide better guidance and prevent fear from keeping us — or our clients — in the dark.
Q: With the Launch of Bitcoin and Ethereum ETFs, What Should Advisors Learn About Next?
A: Beyond ETFs, advisors should delve into on-chain crypto wallets and payment systems like stablecoins to understand their behavioural dynamics. I've found exploring Decentralized Finance (DeFi) and its primitives—lending, borrowing, staking, providing liquidity — offers valuable insights. DeFi operates without intermediaries, relying on persistent code (smart contracts) that functions transparently on public networks.
Q: How Can Advisors Assist Clients Who Want to Self-Custody Their Digital Assets?
A: As decentralized applications evolve, some clients now hold significant wealth in self-custodied digital assets. We can support them by discussing best practices like using multi-signature wallets to enhance security while maintaining control over their private keys. This collaborative approach helps clients understand potential pitfalls and plan contingencies to ensure their loved ones are cared for if something happens to them. Platforms like L1.co — which I'm personally involved with — enable advisors to understand a client's financial situation related to their self-custodied on-chain digital assets
- Nick Rygiel, financial advisor & owner: Ironclad Financial LLC
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