Maybe it’s just me but every time I hear “crypto”, I think of Superman. “Kryptonite” is a fictional substance used in Superman stories. In the most familiar form, it is green and a crystal that comes from Superman’s home planet of Krypton. This Krypto emits radiation that weakens Superman. It is harmless to humans in the short term, deadly long term if ignored. We need superheroes to put it back in its proper place.
I am not saying the latest “cyrpto” is harmful to humans. I believe block-chain is fascinating and has lots of potential long term. It has taken over the place of the latest thing to be over-hyped. Crypto may be the kryptonite, however, for cash. We have been slowly moving towards a cashless society. I remember thinking the debit card would be a gamechanger and it was, but cash survives. Maybe not the penny. Just like the pandemic accelerated the advent of new technologies such as video (Zoom for work, Zoom for friends) and video appointments with doctors, lawyers, and accountants. Crypto may be the catalyst for more cashless transactions and possibly impact how the banking system operates overall.
In the meantime, wealth management firms still suggest traditional investments such as mutual funds, separate accounts, and ETFs. They may also recommend alternative vehicles. The research teams have done their due diligence and have studied past markets where trends seem strong. They will be able to flex when crypto matures a bit bringing clarity to its proper place in asset allocation.
Since margins are thin with fixed income, using a software like Aapryl allows manager research teams to focus on the managers and products that add value—have persistent skill. Value can be added to asset allocation using a system which sees what is delivered versus what is being promised. So, substance over hype.
Did you know Batman had a piece of Kryptonite just in case Superman went rogue? We need investment superheroes to make sure we don’t go rogue and go all in on “crypto”.