By Brandon Miller, CFP–

The CEO of Levi’s recently talked about people needing new clothes because of the pandemic—either because they had shed or added significant weight. How brilliant to sell something that people need no matter which way the wind blows (or waist goes). Of course, brilliance is in their genes, given Levi Strauss’ recognition that the real gold was not in prospecting, but in outfitting those who did.

Mr. Strauss’ early customers might recognize the Wild West, gold rush feel of today’s cryptocurrency environment. After all, “miners” are needed to run the whole system. Everyone is jockeying for the richest claims in this uncharted territory. And tales of Bitcoin billionaires are just as alluring today as yesterday’s gold-strike yarns.

But is there gold in them thar hills for you? First, let’s make sure you understand what you’re investing in given that crypto is a super volatile investment and currently not recognized as an official security by the SEC. Then decide if it fits into your portfolio.

Why the Hype

Our world is increasingly digital and global, which poses myriad challenges for traditional, border-bound currencies. Cryptocurrency was developed to address these vulnerabilities.

Cryptocurrency is a virtual form of currency that you can exchange for goods and services, just like traditional money. It’s secured by encryption that makes it nearly impossible to counterfeit or double-spend. The currency has no intrinsic value, but is worth whatever people will pay for it.

Traditional currencies are under the control of a government or central bank. Value rises and falls based on economic and political factors in that country or bloc. This makes them vulnerable to manipulation and corruption. Crypto avoids this through a decentralized network of computers—open to anyone with enough computing power—that creates and verifies transactions. The value of this border-free currency is based on supply and demand. Many cryptocurrencies limit their supply to increase the price as interest grows.

Crypto transactions can transfer money from one account to another in mere seconds versus the days many banks require to do the same thing. They also eliminate money transfer, exchange, and other fees that get tacked on when banks and middlemen are involved. Merchants that accept cryptocurrency win twice because they get their money immediately and don’t have to pay any fees to a credit card company.

How Crypto Safeguards Data

Much like pickaxes were essential to the prospectors, cryptocurrency requires blockchain technology that ensures the integrity of transactions. Blockchain has other uses, including smart contracts that secure the exchange of everything from electricity to legal documents. (Sensing a Levi’s-type opportunity here?)

Blockchain requires a vast network of extremely sophisticated computers working 24/7 with complex algorithms to encrypt transactions and verify transfers. Rather than one company owning all of these computers—and gaining control over the currency—different individuals and groups lend their computers to the network. These “miners” get paid in cryptocurrency when their computer is the first to solve an impossible-for-humans-to-guess code that authenticates a transaction. That transaction is added to a block of others and stored in a permanent ledger that is theoretically too large and complex to corrupt because it constantly changes.

Considerations When Investing

With its speed, security, and global reach, cryptocurrency has the potential to be transformative in the near future. And it’s fairly straightforward to invest in today; even PayPal lets you buy it. The question is, what to buy?

We’re still in the early days when both start-ups and regulators are ironing out the kinks and wrestling with things like extreme price volatility and unsavory folks using the network for illegal activities. As the internet’s infancy showed us, many of today’s cryptocurrencies will likely fail before a few emerge as winners in the coming years.

So, if you knew Amazon would become a global behemoth when they were just selling books online, well, maybe go ahead and aim for a crypto winner. But I wouldn’t tilt your portfolio’s balance too heavily toward this high-risk/high-reward investment. Instead, you might cool your crypto fever through a fund or ETF that focuses on cryptocurrency.

Or you could invest in blockchain companies that supply the technology that many industries might need to compete in the modern world. After all, most goldminers faded into history, but Levi’s is still going strong 170 years later. Just sayin’.

Want to know more? My firm is offering a virtual crypto seminar on October 29. For details, contact us at

Brio does not provide tax or legal advice, and nothing contained in these materials should be taken as such. The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security. It is only intended to provide education about the financial industry. To determine which investments may be appropriate for you, consult your financial advisor prior to investing. Any past performance discussed during this program is no guarantee of future results. Any indices referenced for comparison are unmanaged and cannot be invested into directly. As always please remember investing involves risk and possible loss of principal capital; please seek advice from a licensed professional.

Brio Financial Group is a registered investment adviser. SEC Registration does not constitute an endorsement of Brio by the SEC nor does it indicate that Brio has attained a particular level of skill or ability. Advisory services are only offered to clients or prospective clients where Brio Financial Group and its representatives are properly licensed or exempt from licensure. No advice may be rendered by Brio Financial Group unless a client service agreement is in place.

Brandon Miller, CFP®, is a financial consultant at Brio Financial Group in San Francisco, specializing in helping LGBT individuals and families plan and achieve their financial goals.

Published on October 7, 2021