Why Responsible Advisers Must Speak Up
Bitcoin is lighting up red flags as it seeks entry into core investment portfolios. Let’s be clear: if an individual wants to speculate with a small satellite allocation, that’s their prerogative. But if I were a reputable product distributor, I wouldn’t want the liability of recommending Bitcoin as a core holding.
And yet, here we are.
Bitcoin’s influence is seeping into the system — not through direct investment recommendations, but through the back door of stock valuations. Treasury strategies like those of MicroStrategy, Tesla, and now UK-listed firms like The Smarter Web Company (SWC.AQ) are causing Bitcoin exposure to appear in everyday equity funds — the same funds retail investors access through ISAs, SIPPs, and passive index trackers.
This creates a hidden systemic risk.
Institutions tracking indices like the S&P 500, Nasdaq 100, or Aquis are now, in effect, holding Bitcoin via corporate treasury exposure. That means many retail portfolios contain Bitcoin without the investor ever knowingly choosing it.
Yet the loudest voices cheerleading Bitcoin — the “moonboys” — show little regard for liability if things go wrong. They are often unregulated, unqualified, and openly hostile toward professionals with decades of experience in risk management. They mistake hype for analysis, and insult for insight.
Bitcoin isn’t being integrated through a process of due diligence — it’s being smuggled in under the euphoric cover of “financial innovation.”
If this were any other high-risk, unregulated asset being injected into mainstream portfolios without investor knowledge, there would be regulatory outrage.
⚠️ The uncomfortable truth:
Financial capital strategies are becoming contaminated by crypto, like a virus that mutates unchecked.
And while the risk may still be small, it is growing — and being ignored by those chasing short-term gains.
Let’s not repeat history.
Let’s not dismiss early warnings as we did with dot-com leverage, subprime exposure, or CDOs.
The difference this time? The “contagion” is decentralised, cheer-led by those with no accountability, no qualifications — and no safety net for the clients they may hurt.
🔍 My position is simple:
- Bitcoin is not suitable for core portfolios.
- It may have a place in small, speculative satellite allocations.
- But its creeping presence in equity markets introduces a systemic risk that must be named.
- The crypto boom is a financial capital event. It is not a human capital strategy.
If we want to build resilient, healthy economies, we must invest in people — in real productivity, creativity, and long-term value.
That’s virus-free.
When we say “let’s not dismiss early warnings as we did with dot-com leverage, subprime exposure, or CDOs”, we’re not claiming that markets didn’t recover — they did. But recovery doesn’t mean the damage wasn’t real or avoidable. Here’s the context:
🧠Dot-com Bubble (2000–2002):
- What happened: Investors poured capital into internet stocks with little revenue or business model. Valuations were based on hype, not fundamentals.
- Impact: The Nasdaq lost 78% of its value. Millions lost savings. Pension funds were hit. Careers and businesses evaporated.
- Takeaway: Risk was mispriced. Due diligence gave way to speculation. Sound familiar?
🧨 Subprime Mortgage Crisis & CDOs (2007–2008):
- What happened: Financial institutions repackaged poor-quality mortgage loans into “Collateralised Debt Obligations” (CDOs) and sold them as AAA-rated products.
- Impact: The global financial system nearly collapsed. Lehman Brothers failed. Millions lost homes, jobs, pensions. Governments had to bail out banks.
- Takeaway: Risk was misunderstood and hidden in layers of complexity. Regulators were late. The public paid the price.
⚖️ So, what about Bitcoin and crypto treasury stocks?
The risk isn’t that these assets exist — it’s that they’re being quietly embedded into passive investment vehicles, without the informed consent of retail investors. The concern is how they’re being packaged, marketed, and distributed — not unlike CDOs were.
Yes, the overall exposure today is smaller than it was in 2008 — but the warning signs are the same:
- Hype over fundamentals
- Retail buying in at the top
- Asymmetrical gains favouring insiders
- Lack of transparency or regulation
- Complexity that obscures real risk
- Warnings dismissed as “boomer FUD”
And while the market might survive another correction, the individuals caught in it may not.
Especially if they’re unknowingly exposed — through index funds, pensions, or retail platforms — without ever choosing to take on that risk.
🎯 In short:
Yes, markets recover.
But real people get hurt, and trust in the system erodes.
Our job, especially as advisers and educators, is not just to chase upside — but to protect downside, uphold standards, and speak up when we see a systemic risk forming.
And this?
It’s forming.
It may look different, but the risk is all too familiar — only now it’s on the blockchain.
“City tradfi” is a shorthand phrase that combines two ideas:
1. “City”
- Refers to The City of London, the UK’s historic and symbolic financial district.
- It’s often used to refer broadly to the traditional financial establishment — banks, asset managers, insurers, brokers, and regulators based in or around the City.
2. “TradFi”
- Stands for “Traditional Finance”, as opposed to DeFi (Decentralised Finance) or the newer crypto-native financial systems.
- It includes regulated financial institutions, legacy systems, fiat currency infrastructure, and long-standing financial practices.
So “City TradFi” =
A casual, sometimes critical way to refer to the traditional financial elite in London, often used by fintech, crypto, or DeFi advocates when contrasting the old guard with the new digital financial revolution.
Depending on tone, it can be used:
- Neutrally: to distinguish between systems (e.g. “City TradFi vs DeFi”)
- Critically: implying that the old system is slow, elitist, or behind the curve
- Defensively: by insiders referring to themselves in jest or irony
While DeFi (Decentralised Finance) was built on ideals of open, trustless systems, many Layer 2 developments — such as Lightning Network (for Bitcoin) or rollups on Ethereum — reintroduce central points of failure. These include:
- Custodial service providers
- Off-chain governance
- Validator/miner cartels
- Venture-backed protocols with controlling interests
In effect, the infrastructure is drifting back toward the very power dynamics it claimed to disrupt — raising hard questions about whether we’re just rebuilding TradFi on a shinier, blockchain-based foundation.
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About Get SAFE
Get SAFE (Support After Financial Exploitation) was born from a simple truth: too many victims of financial abuse are left to suffer in silence.
We exist for people like Ian—for the ones who did everything right, only to be failed by the systems they trusted. We know that behind every vanished pension, every ignored complaint, and every stonewalled letter is a person—frightened, exhausted, and too often alone.
Get SAFE offers more than sympathy. We offer structure, support, and solidarity.
We provide a voice where there’s been silence, and clarity where there’s been confusion.
We stand beside those who have been exploited, not just to help them recover—but to help them reclaim their story and rebuild their future.
Because financial justice is not a luxury.
It’s a human right.
If you or someone you know has been affected by financial exploitation, we are here.
You are not alone.
Learn more at: Get SAFE (Support After Financial Exploitation).
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