Understanding Cryptocurrency Assets
At Sweetwater Digital Asset Consulting, we’re convinced that the key innovation of the October 2008 Bitcoin whitepaper is a blueprint for synthesizing digital scarcity without the need of a central authority to maintain that scarcity. The “killer app” of this new form of Internet-compatible scarcity is money. Far from being a trivial use case, the design of a new money inherently includes critical design decisions that affect its societal suitability. Furthermore, a key feature of both the original cryptocurrency, Bitcoin, as well as Monero, a privacy-preserving complement, is their idealistic, open-source, grass-roots, volunteer labor force of cypherpunk coders, standing in stark relief to the top-down control of global central banks.
“When in Rome, do as the Romans do” — Sweetwater Digital Asset Consulting believes that the best way to capture future upside is to observe what early crypto adopters did, which is to acquire and self-custody the rare crypto assets that operate with the above principles. Given self-custody, the due diligence process moves away from attempting to figure out which counterparty to trust, and moves towards actually understanding decentralized digital assets. Direct self-custody also avoids custodian fees, both transparent (AUM-based) and subtle (chain fork policies), which can substantially erode investor upside.
Just like with traditional assets, volatility tolerance is a key behavioral characteristic that can make or break real-world performance. Sweetwater Digital Asset Consulting’s advisory approach emphasizes education — not only in the technical mechanics and social dynamics of cryptocurrencies, but also in promoting self-awareness of behavioral biases, and avoiding the typically expensive decision of acting on them.
Currently, financial planners and wealth managers do not have, as part of their professional certification process, any requirement to demonstrate even the most basic competence when it comes to cryptocurrencies. When their clients ask them about cryptocurrency, they’ve generally found it easiest to simply dismiss it. As a result — and unfortunately for their clients — the incumbent wealth management industry has completely missed the meteoric price appreciation of Bitcoin from under a penny in 2010, to its current levels. Adding Sweetwater Digital Asset Consulting to your wealth advisory team allows your legacy financial advisors to continue doing what they do best, while gaining the deep subject matter expertise in cryptocurrency that’s needed to go beyond following the herd. With experience and credentials that are respected in both the traditional finance and cryptocurrency worlds, Sweetwater Digital Asset Consulting takes a team-based, collaborative approach towards providing clients with holistic wealth management.
Retaining Sweetwater Digital Asset Consulting, LLC gives traditional asset clients access to a exceptionally credentialed “sherpa” service to guide them towards direct inclusion of this disruptive new asset class into their portfolios.