Summer Greetings from Sarson Funds

Summer greetings from Sarson Funds,

We hope this letter finds you healthy, happy, and enjoying the last beautiful days of summer.

Cryptocurrency prices have kept us on our toes at Sarson Funds this summer, living up to their reputation for volatility. Announcements about China seeking to curtail the growth of Bitcoin within its borders coupled with the sharp about-face from Tesla’s astronaut-in-Chief, Elon Musk, on accepting Bitcoin temporarily seized the public narrative and contributed to selling pressures in May and June.

As we start the month of August, Bitcoin and other cryptocurrencies continue in a choppy sideways trading pattern, with most assets showing a high correlation to Bitcoin. Meanwhile Bitcoin is still searching for its equilibrium price in the $40,000 – $50,000 range. There are many reasons to be excited about what has been happening in the market. We would like to share a few of our observations with you.

Over the course of this year, the United States has become a top destination for cryptocurrency companies to reside. The SEC, under the thoughtful leadership of Gary Gensler, has shown its acute awareness of the durable value propositions digital currencies are able to offer for both the financial sector and for the consumer. Gary and his team have been working to educate Congress, the CFTC, the Federal Reserve, and the Executive Branch on the inevitability of the world’s evolving financial architecture. Thankfully, American-led innovation in digital assets has been keeping the future of finance located in the United States. Digital asset companies, including our partner firm lending giant Celsius Network Ltd, are moving their operations to the United States from other countries. This is quite a sharp contrast from two years ago, when Facebook’s Libra project received such a hostile reception from lawmakers that Libra promptly moved their entire operation out of the United States.

There have been signs all around us which show financial institutions are rushing into the cryptocurrency markets. Traditional Wall Street firms that were once anti-cryptocurrency such as Wells Fargo, Goldman Sachs, and CitiBank have recently built crypto brokerage divisions into their corporate strategies. BlackRock, Fidelity, and Bank of America have invested in Stablecoin companies (ex: Circle and Paxos). StateStreet and JP Morgan currently have hundreds of job postings seeking employees to fill their expanding digital currency and tokenization initiatives.  Institutions are moving with remarkable speed to establish their crypto-capabilities.

With all the excitement circling around cryptocurrency, we continue to invite and welcome the opportunity to help service your digital asset investment and educational needs.  Please reach out to us any time so we can show you how we are helping other advisors and their clients with this new asset class.

Warm regards,

John Sarson, CEO & Cofounder

Jahon Jamali, CMO & Cofounder

Crypto Infrastructure Bill Updates: Why the US Must Act Now

The new crypto infrastructure bill created uproar in the crypto community over the last several weeks, as the bill introduced reporting requirements for the vaguely defined crypto “brokers.” The bill’s broad definition of brokers could include not only reporting requirements from websites that enable decentralized finance, or DeFi, but could be interpreted to include those same requirements for cryptocurrency hardware storage providers, such as cold storage wallets. 

DeFi is the fastest growing segment of the crypto industry, as developers are building cutting-edge solutions to decentralizing the financial services industry. Within the DeFi space, users can find decentralized solutions to lending, swaps, insurance, derivatives, synthetic traditional assets, and hopefully much more in the future.

Sarson Funds Chief Marketing Officer Jahon Jamali shared his thoughts on the infrastructure bill on an NTD news segment covering the crypto infrastructure bill, noting, “What we want to have here in the United States is regulation that promotes innovation. The United States is the home of fintech innovation, and that’s where we want to keep it.” In recognition of the pace of global crypto innovation, it is critical that the United States establishes itself as a benchmark for the world to follow, however, if the current proposed bill makes its way through legislation, the US risks surrendering its position as the standard for global finance and economics. With the future of finance leaning toward crypto, the United States must course correct to strengthen its position as the leader of global finance.

Stay tuned for updates as the proposed bill faces the House of Representatives this fall.