One thing was clear from Consensus 2024: adopting digital assets is a growing trend in financial services. The landscape of digital assets has evolved significantly over my twelve years in the crypto and blockchain industry. This Consensus, my fifth, opened my eyes to the transformation and growth opportunities.
As I listened to attendees and attended a diverse range of sessions, two clear themes emerged from Consensus 2024; digital assets are ready to play a bigger role in financial services, and innovation partners who can bridge the gap between digital and traditional assets will become dominant players in the industry.
Reflecting upon the conversations I had with people on both sides of the DeFi and TradFi divide, four key takeaways emerged that point to the direction wealthtech companies can take in breaking down the silos.
Takeaway One: There is Renewed Energy in the Digital Asset/Blockchain Space
The market downturn experienced in late 2022 through 2023 significantly impacted the digital asset industry. Even if you had an excellent idea for the market during this period, most people had already started to avoid the digital asset/blockchain space.
However, this year, we have witnessed a resurgence in the price of Bitcoin, igniting renewed interest in investment in both projects and large established institutions. This renewed energy felt authentic and natural rather than forced. This was especially apparent among the financial advisors and RIAs in attendance. Wealth management firms enthusiastically followed the launch of the Bitcoin ETF in January and the preliminary approval of the Ethereum ETF just before the conference. Their energy in the conference hall was palpable, as was their desire to work with technology partners who could quickly bring these assets into investor portfolios.
Takeaway Two: The Digital Asset Industry is Maturing
When I first started attending Consensus, numerous projects had no clear purpose or long-term value. However, with cheap money, it was easy to attract “investors.” From 2023 to 2024, the change in the maturity of firms attending was noticeable, instilling a sense of reassurance about the stability and growth of the digital assets industry. Although several new projects were on display, there was significant interest from mature and larger capital market firms.
There was a noticeable shift towards wanting to listen to end consumers and gather feedback to evolve products. In previous years, it seemed more like putting technology in front of consumers and hoping it’s what they need, which, as anyone in product knows, could be better. This shift in focus toward consumer needs and feedback further solidifies the industry’s maturity and commitment to growth. They are looking to partner with B2B2C companies like FusionIQ, which understand the nuances and frictionless digital workflows necessary to broaden the reach of digital assets in wealth management.
Takeaway Three: Build, Evolve, Build, Evolve
People new to capital markets and are now entering the digital asset space have been struggling to understand why the development of this new ecosystem has yet to take off as expected. This issue goes beyond digital assets and is more about human psychology and the fear of change. We are witnessing this firsthand in the wealth management sector. Just a year ago, if you had asked advisors how many of their clients were interested in Bitcoin or other digital assets, the response would have been much more subdued than it is now. Why is that?
I heard from financial advisors and RIAs at Consensus that people are naturally afraid of change; they get stuck in their ways and don’t know what they don’t know. That’s why it’s essential to partner with cloud-native wealthtech companies that can break down the silos between asset classes, seamlessly bringing digital assets and traditional assets together in a single diversified investment portfolio. I heard at Consensus that more conventional asset firms want to venture into digital assets, more than any other time I have seen in the digital asset sector over my twelve years.
Takeaway Four: The Importance of Education
The highlight of the conference for me was the FA & RIA Day, organized and sponsored by leading firms in the institutional industry. This was the strongest indication of how much the cryptocurrency industry has progressed. I had never been in a room with over 50 RIAs, all eager to learn about digital assets and Bitcoin. It was a refreshing experience to see them engaged and asking questions without any fear of getting into trouble for discussing such topics.
At the same time, it also reminded me that there is still a lot of misinformation and fear regarding digital assets. Industry leaders need to continue educating others about the importance of digital assets as part of a diversified investment portfolio. Companies like FusionIQ have been developing solutions that were ahead of their time but are now in demand. While there is still much to be done in this area, emphasizing the importance of education in the wealth management sector empowers financial advisors and their clients and makes them feel responsible for the industry’s future, fostering a sense of collective commitment and dedication.
Conclusion: The Time is Now to Break Down Investment Silos
Consensus 2024 showed that there is a growing trend of adoption across various segments of the market. This adoption is primarily driven by organic growth and the increasing interest from financial advisors, wealth management firms, and their clients.
I left Consensus with a renewed enthusiasm for our vision at FusionIQ, which is to make it easy for financial advisors and institutions to be digital wealth leaders. As we break down the barriers between asset classes with our innovative products like FIQ Market One, we’re excited to partner with forward-thinking advisors and firms that want an easy on-ramp to digital transformation to win in competitive markets.
