Lately the subject of Bitcoin, cryptocurrency, and the blockchain has been garnishing daily headlines around the world. As a financial professional, how much do you really know about it? If the extent of your awareness on this topic comes from sensationalized media headlines, you may want to spend some time updating your professional profile to include a strong knowledge base or certification in digital currency.
Bitcoin earned the distinction of being the best performing currency in 2015. Your clients may be interested in it as an investment , to accept as payment in their business or charity, or they may have questions regarding taxation and other issues. They are relying on you, as they would in any other financial matter, to provide them with accurate and up to date advice, information, and strategies.
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"Whether you are an enthusiastic advocate or a staunch traditionalist, wealth advisors - especially those with fiduciary responsibilities - have an obligation to get educated on digital currrency and understand the implications for themselves, their practice, and their clients." - Hannah Shaw Grove, Financial Advisor Magazine
Even though you may consider Bitcoin unsuitable for your client, and convey your reasoning to them, ultimately the decision is theirs. After you explain the risks associated with cryptocurrency, any financial , tax, or legal implications, and answer any questions your client may have, if they still wish to invest, is it not your responsibility to help them?
Are you prepared? Do you know how to buy, store securely, and utilize Bitcoin and other cryptocurrencies? Can you recommend specific currencies or at least advise your client how to select them? Even though they are decentralized and not owned as a business, should they not be run as one? How will Bitcoin fit into their portfolio and what kind of returns can they expect? Regulations are changing rapidly - are you up to date on the tax and legal issues in your jurisdiction?
There are many online places to start learning about cryptocurrency, with options ranging from free sources to university level courses. The Digital Currency Council, the association of professionals in digital currency, has online training available that is designed specifically for financial professionals. There is a free introductory course, a more in-depth certification course to raise your professional profile, and they also offer continuing education credits. (See Links Below)*
"We believe professionals should be held to a higher standard than the average person, because they are advising others for a fee. If you or I want to make an investment in bitcoin, that's our prerogative. But, if someone is going to advise us on it, we're putting our faith in them, so we're going to be held to a higher standard" - David Berger, Founder and CEO of the Digital Currency Council
When all is said and done, if your clients need your advice regarding Bitcoin, DNotes, or another cryptocurrency, will you have the expertise to deliver the facts, or will you lose them to another, more qualified, financial advisor?