Crypto hits the mainstream

Jeff Benjamin [00:00:04] Hey folks, my name is Jeff Benjamin with InvestmentNews, we’re talking today with Ric Edelman, founder of the Digital Assets Council of Financial Professionals, also known as DAC FP. How are you doing, Ric? 

Ric Edelman [00:00:17] Doing great, Jeff. Good to be with you. 

Jeff Benjamin [00:00:18] Thanks for being here. Got a couple of quick hit questions for you. First of all, I want to get an update on DAC FP. What’s going on with it? Where are you in the development and what can we expect to see from there? 

Ric Edelman [00:00:30] I originally thought four years ago when I created this organization that it would be a short lived, part time hobby. But there is so much demand for knowledge and education about crypto that it’s become my dominant full time activity. We now have twenty one employees and we’re adding several more. Our certificate program is proving to be highly popular. We introduced it last May and we now have more than 2000 advisors who have enrolled in the program from eight countries, and we’re getting inquiries from major Wall Street firms to help them provide financial education in the area of crypto for their advisers and their Home Office staff. So we’ve struck deals with a number of organizations and we’re also now the official education partner for crypto, for the CFP Board, the Financial Planning Association, the Investment Advisers Association, the Money Management Institute, X-Y Planning Network, Napfa and the IARFC, and many others. Because there’s no real resource, there’s no outlet for people to learn in the financial services industry about bitcoin, blockchain digital assets. We’re the only game in town and everybody knows me because I got a forty year history as a financial adviser, and everybody knows that the information I convey is objective. It’s agnostic, it’s not product pushing that is simply designed to provide you the education and information you need so that you can effectively serve your clients. 

Jeff Benjamin [00:01:55] Just quickly on the certification. What does that entail? What does it cost? How long does it take? How difficult would it be for like a regular person like me to to get that certification? 

Ric Edelman [00:02:06] So there are 11 modules. It’s an online self-study, self-paced course. So the 11 modules, you can binge it in a weekend if you feel like it, or you can take your time and take the classes over a period of several months. It’s a world class faculty. For example, Scott Stornetta, who’s the co inventor of blockchain technology, is on our faculty. Shawnna Hoffman, who is headed up IBM’s blockchain initiative, is on our faculty. Anders Braunworth with the Fed is on our faculty. It’s it’s a world class faculty, no product sponsors, it’s product agnostic and the 11 modules are broken into two parts. The first part is all about the tech What is blockchain? What is bitcoin? How does it work? The second part of the course is all about financial advisers. What’s the investment thesis? How do you construct a portfolio? What are the investment opportunities? And most importantly, how do I talk to my clients about this? So the course is really focused for advisers delivered by financial experts in the field, and the course is just six hundred and forty nine dollars. So you get 13 CE credits by completing the program. And a lot of the organizations we’re working with provide discounts so you can obtain access to the course for even less than the six hundred and forty nine bucks. So it’s really easy to do. It’s very effective. It’s comprehensive and really easily accessible online at DAC FP. 

Jeff Benjamin [00:03:32] Thank you for that. Let’s talk about crypto a little bit here. I I tracked bitcoin. I know there are a ton of cryptocurrencies out there, but I’m looking at bitcoin over the past 12 months, down almost twenty four percent. What’s going on with the cryptocurrency free fall? 

Ric Edelman [00:03:49] Well, it’s not unusual with any new emerging asset class. Bitcoin has had five occasions since its inception in 2009, where it has experienced a decline of 50 percent or more. Most recently, in the last six months, this has happened. But this is natural if you in fact you want to have some fun. Do this? Go take a look at the first 12 years of Amazon stock. Go look at the first 12 years of Apple, the first 12 years of Microsoft, the first 12 years of Google, Alphabet, and you’ll discover the same kind of incredible volatility. So there’s nothing unusual here about this. We’re at the stage now where bitcoin is enjoying a massive increase in price. You mentioned it’s down twenty four percent over a longer period. It’s frankly up about 50 percent in the last month. That volatility actually works to your advantage from a dollar cost averaging perspective or rebalancing perspective. Remember, we love the idea of a diversified portfolio. A one or two or three percent allocation in bitcoin makes perfect sense. I wouldn’t do 30, 40 or 50 percent, but one, two or three. No reason not to. 

Jeff Benjamin [00:05:02] And then let’s talk about what’s going on in the financial services industry, the big company level regarding crypto. Schwab recently filed to enter a crypto ETF. What what do you make of that? Schwab’s kind of a conservative company, isn’t it? 

Ric Edelman [00:05:16] Very much so, and that’s what we’re beginning to see. Conservative, cautious, well-regarded companies who care predominantly about consumer protection are now getting involved. MetLife bought $100 million worth of bitcoin last year, and their CEO is on the board of NYDIG, a major crypto company. You’ve got mainstreaming going on right now. Fidelity, of course, is hugely involved in bitcoin. They’ve been doing bitcoin mining for years, and Fidelity Digital Assets is a major crypto custodian in the marketplace. Schwab’s entry by filing for a Bitcoin ETF, they join the ranks of more than a dozen others who have made similar filings. Is Schwab’s way of saying this is now ready for prime time. And it’s a it’s inevitable that the SEC will say yes to a Bitcoin ETF, and that means everybody in the financial services industry will be clamoring for market share. Schwab is saying they’re signaling very clearly. We don’t want to be left behind. We want to be able to continue to provide our clients, our customers, our investors state of the art investment opportunities. This shows that it’s gone mainstream. In fact, last year, institutional trading of crypto was three times more than retail consumer trading of crypto. So we are now seeing billionaires, hedge funds, endowments, pension funds, corporate treasuries, private equity firms, venture capitalists. They are all engaging in this space. And over the next couple of years, it’s going to be a routine part of every client’s portfolio, which is further causing advisors to say, Gee, I better learn about this. I better figure out what this is so I can effectively talk to my clients and help them. And that’s again full circle as to why we’re getting so much growth at DAC FP with investment investment adviser interest in our certification program, as well as our webinars and other content. 

Jeff Benjamin [00:07:11] All right. Well, Ric Edelman, you’ve always been on the front end of this crypto thing, and I think that we can all learn a lot by following what you’re what some of your messages are. Thank you very much. Rick Edelman, founder of Digital Asset the Digital Assets Council of Financial Professionals. Thanks a lot, Rick.