Are Crypto Assets Suitable for Wealth Building? An Approach to Opportunities and Risks
Published on 2025-10-22
The debate over the sense or nonsense of crypto-assets often oscillates between extremes: the pendulum swings between "Bitcoin is the solution to all problems" (Bitcoin maximalists) and "All lies and deceit, plus hot air" (conservative financial experts, over 60) back and forth, confusing interested private investors who are actually seeking stability and orientation amidst the contradictory flood of information.
Fortunately, there are enough shades of gray between the extremes to seriously and agnostically engage with blockchain technology and its applications such as crypto-assets – which of course involves time and effort.
Bitcoin: A Technological Innovation with a Long History
The relatively new asset class of crypto-assets indeed offers interesting return opportunities: Bitcoin has achieved a nearly fairy-tale nominal return of over 800% in US dollars over the last five years. And Bitcoin is also highly interesting from a technological perspective, as various innovations from cryptography, computer science, and monetary theory are spectacularly combined. However, the history of ideas is much older: Bitcoin had prominent intellectual forerunners long before the invention of blockchain: even F.A. Hayek viewed the currency monopoly of central banks skeptically and favored competition among free, private currencies as early as the 1970s – his theses are once again highly relevant in light of the persistently excessive creation of fiat money on both sides of the Atlantic.
Institutional Acceptance: Crypto Has Arrived in the Financial Industry
After years of standing on the sidelines, institutional adoption is now progressing at an accelerating pace: "big money" apparently has hardly any doubts left, as even major US banks have recognized the value of Bitcoin and Co. Leading the way is the world's largest asset manager, BlackRock, which has issued spot ETFs on Bitcoin and Ethereum. The inflows since the beginning of 2024 are remarkable; crypto-assets have evidently arrived in the financial industry.
The intentions of the still anonymous creator or collective ("Satoshi Nakamoto") of Bitcoin were of a completely different nature: an alternative electronic payment system for everyone was the vision of the creators: hard money (fixed money supply) that can be transferred globally, easily, and securely from user to user ("peer to peer"). All without intermediaries like banks or other costly middlemen.
Self-Custody or Custody by Third Parties?
Private investors in Switzerland are also familiar with overpriced fees: in the crypto space, interested investors should always keep an eye on investment costs. The financial industry, such as 21Shares or VanEck, offers crypto securities for private investors, conveniently with ISIN for their domestic depot. The risk of self-custody is eliminated; however, the inclined investor should carefully check the fees, as even simple ETPs often come with a proud TER of over 1.4%.
Therefore, self-custody of crypto-assets remains attractive and possible – if one is willing to take the necessary security precautions and acquire the necessary knowledge. Here, a skilled financial planner can provide serious assistance in a rapidly growing market.
It is simple, straightforward, and decentralized
Decentralized Financial Protocols: New Opportunities for Investors
Decentralized solutions in crypto-assets avoid counterparty risk through direct interaction among participants. This allows private investors to act among themselves, with a globally low entry threshold – one only needs a smartphone, a wallet, and an internet connection. When purchasing cryptos on exchanges, one also has a choice: centralized providers like Coinbase or Kraken versus decentralized exchanges like UniSwap, where algorithms take on the role of market makers, eliminating the need for an order book as in a traditional exchange. Furthermore, the world of decentralized finance, thanks to blockchain, offers real-time transparency: anyone can check how many fees a protocol (rules system) generates, how much capital is currently invested (Total Value Locked, TVL), and how quickly user adoption is progressing – what a difference compared to various nebulously structured products ("Multi-Barrier Reverse Convertible with Knock-Out") in the traditional financial world, where transparency, utility, and comprehensibility raise many questions.
The attractive returns of crypto-assets will likely continue to lure private investors into the highly volatile and comparatively less regulated crypto market. Therefore, it is essential for financial planners to provide serious education about opportunities and risks. Especially as a contrast and counterweight to the currently loud "finfluencers" in the crypto space who regularly make their presence felt on social media.
In the spirit of a holistic view, interested investors should also consider custody and, not least, digital inheritance – the most beautiful returns are of no use if the technically inexperienced heirs do not have access to the wallet. But also on the tax side, good advice is needed; the correct and optimized taxation of capital gains from staking (locking tokens to secure the network), lending (crypto lending), and liquidity mining (providing liquidity) should become part of the repertoire of a modern financial planner or trustee in the future.
Conclusion: The Role of the Financial Planner in the Crypto Market
Informed clients can compare conditions and returns well thanks to the internet. The financial planner of the future should therefore undergo the transformation from a financial product seller to a holistic-thinking financial coach; only this can, in my opinion, authentically and conflict-free advise knowledgeable clients on equal footing. And artificial intelligence will not take away our ability to think about investment decisions, but hopefully streamline technical processes and administration. The financial coach of the future should have the setup of wallets, assessment of crypto-assets, and also digital inheritance in their advisory arsenal. Because those who do not keep up with the times will be left behind.
Four Key Takeaways for Private Investors
From a sober financial planning perspective, crypto-assets are a highly volatile asset class with a short track record. Attractive returns and growth opportunities are countered by high risks – this generally applies to all financial instruments.
Due to their low correlation with traditional investment instruments, crypto-assets already offer a way to diversify investment portfolios in most market phases(!).
Healthy skepticism: Beware of unscrupulous market participants! Fraud is unfortunately still regularly found. Investors without market experience should not invest significant sums in the crypto market.
Decentralized financial protocols (DeFi) offer attractive returns through liquidity mining with moderate entry barriers. However, caution is warranted, and experience is required: valid knowledge is necessary to regularly achieve and secure returns.