Don’t Let the Banking Crisis Go to Waste
Editor’s Note: Today’s Wealthy Retirement comes from Andy Snyder, our good friend and the founder of Manward Press.
In light of everything that’s happening in the markets (e.g., the major banking crisis that Andy talks about below)…
I think he’s probably itching to say, “I told you so.”
Andy has been talking about the inevitable move from banks to blockchain for months. And this recent crisis is the icing on the cake.
He pinpoints one asset class that will be the huge winner in all of this…
Read on for the details.
– Rebecca Barshop, Senior Managing Editor
Don’t let a crisis go to waste.
It’s the battle cry of the political class. They preach it for a reason.
As investors and traders, we must embrace the same mentality. There’s no doubt the banking world is in a crisis. The sector’s stocks have plunged.
It’s creating tremendous opportunity. Some stocks have already surged from new lows.
But I’m not here to tell you to trade banks. There are profits to be made, but the sector is a volatile mess. It’d be a pure gamble.
Instead, we need to do what we do so well at Manward. We need to dive into the story behind the story… to find the truly monstrous gains.
There’s no doubt that this latest crisis has its roots in the crypto market. As huge Bitcoin bets failed, several large companies and several large banks absorbed major losses. The fall of New York’s Signature Bank is certainly tied to crypto.
It has the folks at the Securities and Exchange Commission (SEC) itching for action.
More regulation is certainly on the way.
That has some investors worried. Some of the world’s savviest investors, though, are pumping their fists in anticipation of what’s about to come.
The latest worry in the crypto industry is over a very popular token known as Cardano (ADA). There are growing concerns that the SEC will deem it a security. If it fails the oh-so-important “Howey test” (the test regulators use to determine whether an asset is indeed an “investment contract”), the token’s trading will grind to a halt.
We saw this happen recently with Binance’s stablecoin. And, of course, Ripple has been the poster child of this fight for years. If it loses its case with the SEC, it will face a $2 billion penalty.
Indeed, the push to label cryptos securities is creating a crisis for many players in the space. There’s a panic.
We mustn’t let it go to waste.
Instead of buying a crypto and worrying that regulators may suddenly eat it for lunch, we should invest in the tokens that have already done the inevitable and registered as securities with the SEC.
Few folks likely read it, but in his latest note to investors, BlackRock’s famed CEO Larry Fink hit on the subject.
The billionaire believes security tokens could be the next big thing in the realm of digital assets.
From his letter…
In particular, the tokenization of asset classes offers the prospect of driving efficiencies in capital markets, shortening value chains, and improving cost and access for investors. At BlackRock, we continue to explore the digital assets ecosystem, especially areas most relevant to our clients, such as permissioned blockchains and tokenization of stocks and bonds.
Those last five words are huge – “tokenization of stocks and bonds.” That trend represents the future of not just money but Wall Street.
Look, the Federal Reserve just quietly announced it will launch its new “FedNow” instant payment system in July. Testing by several firms will start within the next few weeks.
This new system will allow for the instant transfer of payments across banking systems. Currently, these transfers can take days.
It’s clearly the first step in what Fink is talking about – moving our money, our stocks and almost all of our tradable assets off today’s outdated and unsecure platforms and onto the blockchain.
It’s the future of money. It’s what so many crypto zealots have yearned for.
But it’s not happening outside of a well-regulated space. This latest crisis proves it.
Security tokens are going to be the HUGE winner in all of this.