A large number of financial advisors should spend some time to clearly understand what is bitcoin, cryptocurrencies or the blockchain technology on which all the things are created. It might be the case that advisors might fully ignore the bitcoin or they are frightened by trying hard to understand technology. Also, many advisors don't understand the impact of Blockchain in different areas of life.
The main three reasons why financial advisors should consider these technologies seriously are:
1. Clients want to study from Trusted Source
Presently, the media is covering various topics on cryptocurrency, due to this clients are thinking twice before getting involved. However, some want to clearly understand the technology.
Various broker-dealers, banks, and financial institutions have strict rules about cryptocurrency is not a favorable excuse given by the advisors for not spending the time to understand the technology. This is the best time for advisors to understand the whole cryptocurrency.
Instead of involving in fights with clients or just ignoring the topic, advisors should ask clients what they know about the technology. Advisors should also share about bitcoin and how it will impact money and technology.
Bitcoin was released in 2009, in order to allow transactions for people worldwide by forming a peer-to-peer network. Bitcoin is known as “Internet of Money” by a well-known author Andreas M. Antonopoulos.
Hence, advisors should spend a particular amount of time to learn basic of cryptocurrency. Various times Bitcoin has been declared dead by media outlets. Here, the news only focuses on how to gain more viewers.
2. Blockchain Technology will stay forever
When you start learning about Blockchain, you might find it complex. However, if you are trying to understand bitcoin without having a clear knowledge of blockchain is a complete miss. Please understand that Bitcoin can't exist without blockchain but blockchain can exist without bitcoin.
Blockchain was invented by a group of people with a pseudonym Satoshi Nakamoto in 2008. The technology is mainly used to form a peer-to-peer electronic cash system known as “Bitcoin”. The blockchain is a digital ledger of cryptocurrency transactions.
In blockchain, all the transactions are digitally signed, cryptographically secured and shared with a global network of computers. This process is done to check authenticity and integrity. All the verified transactions are added to the previous block of transactions. This is the main task of miners in the bitcoin blockchain network. On successfully solving the puzzle miners are rewards 12.5 bitcoins.
As there is no control of any central authority on Blockchain, it makes blockchain technology disruptive. Blockchain will disrupt various industries like healthcare, real estate, financial services, etc.
3. Popular Finance and Technology industries are getting involved
Big companies like Google, Goldman Sachs, Cisco Systems, etc. are funding various startups. Blockchain Technology has gained a lot of interest from Microsoft, IBM, Intel, etc.
In order to serve clients in the best way, financial advisors should have good knowledge about opportunities rolled out by blockchain technology. Also, they should discuss probable outcomes of investing directly in crypto. Financial advisors who don't want to understand new technology, new thinking, and new aspects might lose current clients and fail to gain new clients.
To avoid these things, advisors should understand all the concepts of cryptocurrency and also provide proper information to the clients. By doing this, they will be able to attract new clients and also help them to build a great portfolio.