There was a recent Wall Street Journal article about a new bipartisan Senate bill being introduced that would give the Commodity Futures Trading Commission (CTFC) oversight of Bitcoin and other cryptocurrencies rather than the Securities and Exchange Commission (SEC).
Personally, I am leery when it comes to cryptocurrencies and I realize that it is due to not understanding how they work. So, I looked up an explanation on blockchain and found that it is a system of recording information in a way that makes it difficult or impossible to change, hack or cheat the system.
Then I see an August 10th article on CNBC, the headline read “Hackers have stolen $1.4 billion this year using crypto bridges”. Crypto bridges link blockchain networks together and have become a major target for cybercriminals.
As so often happens when looking at one article you see references to related topics. While reading about Bitcoin, I noticed an online article printed by Financial Times about a Virginia pension fund attempting to boost its return by investing in crypto lending markets and came across the term “yield farming” in which investors lend out their digital tokens to crypto projects in return for a fixed stream of payments. The article notes that the Pension fund was already investing in crypto before making the decision to move into yield farming.
I usually think of pension funds as being more of a conservative investor, maybe it’s time for me to rethink crypto. At some point investing in Bitcoin and other cryptocurrencies will be the “norm” just another asset class. For now I plan of sticking with investments I have a better comfort level with and will watch crypto from the sidelines while I do additional research.
First State Trust Company is not currently acting as a Trustee, Custodian or Reporting Agent for any accounts investing in Bitcoin and other cryptocurrencies.
David Draper, Managing Director & COO
Phone: (302) 573-5808 / Email: firstname.lastname@example.org
The posts expressed are views of FSTC and are not intended as advice or recommendations. For informational purposes only. FSTC does not offer tax or legal advice, professional counsel should be sought for tax or legal advice.