What the History of the NFL Tells Us About the Future of Finance
In 1966, the American Football League and the National Football League merged into the NFL we know today.
Let’s call it a “if you can’t beat ’em, join ’em” moment…for both sides.
Which, I think, is a pretty fair analogy to what’s happening these days with crypto and traditional finance.
Just last week, an email landed in my inbox announcing that Nexo, a Swiss “crypto-bank,” has partnered with a division of Fidelity, the big U.S. brokerage firm.
If you haven’t heard of Nexo, it offers crypto savings and loans. As a depositor, you can collect 6% annual interest on bitcoin. You can even earn 10% on low-risk crypto tokens that track the U.S. dollar very, very tightly (generally within fractions of a penny). Nexo and the other “crypto-banks” are an amazing way to earn double-digit returns on your cash.
When many people first hear about “crypto-banks,” they assume that they’re risky. In reality, they’re very low-risk and they’re getting more secure all the time…which brings us back to the Fidelity-Nexo deal.
Among other points, the tie-up means Nexo customers gain uber-strong security services and additional financial protection in the form of account insurance (think: FDIC for a bank account, only different).
As I was reading about that deal, I started thinking about Coinbase, the world’s biggest crypto exchange, and its hookup a few months ago with PNC, the #5 commercial bank in America. That partnership aims to make crypto access easy for PNC bank customers.
And then over the summer we had the American Bankers Association urging its member banks to partner with crypto firms because of “rising demand” among bank customers. Which dovetails nicely with a poll from NYDIG, a bitcoin investments group, indicating that 80% of bitcoin owners would move their cryptocurrency into a bank, if crypto-storage services were widely available.
The point of all of this is that traditional finance is changing.
It’s moving into the cryptosphere because that’s where money is going.
Right now, giant commercial banks globally—as well as major central banks around the world—are testing payment mechanisms that use crypto technologies.
We also have numerous major governments formulating crypto regulations, even as the International Monetary Fund and the World Bank are pushing for harmonized rules.
And then there’s the push for central bank digital currencies, or CBDCs. These are sovereign currencies, like digital dollars, digital euro, digital yen, etc., but based on the exact same technology used to create bitcoin and all other cryptocurrencies.
Of 90 countries tracked by the Atlantic Council, 10% have already launched a CBDC, while about 33% are in the piloting and development stages. Another 43% are in the research phase. In all, more than 80% of the countries tracked are moving toward crypto-based digital currencies as a replacement for physical cash.
When I think about those facts, it makes me wonder what people who bash bitcoin, Ethereum and other crypto are not seeing?
I mean, it’s not like any of that information is hidden behind a super-secret door that only wizards and jesters can unlock.
It’s all over the internet. It pops up everywhere in my newsfeeds. All the time.
So, if you see that, how do you then surmise that, “Ah, this bitcoin hoo-ha is all a bunch of horse hockey! Digital dollars? Ha! Ridiculous! Honey—what time is The Lawrence Welk Show on?”
I just don’t get it.
Our world is going digital. No take-backs.
The computer was phase one. The internet was phase two.
Now we’re entering phase three: crypto.
As we speak, blockchain—the ultra-secure technology that powers bitcoin and crypto—is bringing money into the digital realm.
It’s simply the next logical progression. Everything else in our lives has gone digital…why wouldn’t money go digital too?
Which means all those people screaming at bitcoin, including many in the media, are a chorus of irrelevance.
I stopped listening a long time ago.
Instead, I follow the money.
When America’s biggest financial names are partnering with crypto firms…that tells me all I need to know.
I’m on the right path to a wealthier future.