Should cryptocurrency be a part of your retirement savings?

In this week's retirement segment sponsored by Fidelity Investments, OnRamp CEO and Co-Founder Tyrone Ross Jr. explains why cryptocurrency and blockchain investments could be useful in retirment portfolios.

Video transcript

ALEXIS CHRISTOFOROUS: Bitcoin is taking a bit of a breather after reaching all-time highs earlier this week. Right now off just about 2 and 1/2%. Let's get over to Jen Schoenberger for a closer look at this week's pretty wild moves. Jen.

JENNIFER SCHONBERGER: Hey there, Seana. Yeah, that's right. Bitcoin coming off its all-time high to end the week just about where it actually started after a historical rollout of the first ever Bitcoin futures ETFs. Take a look at a chart of Bitcoin of the week. It reached almost $67,000 midweek. Now just under 61,000.

A second Bitcoin futures ETF made its trading debut today on the NASDAQ, Valkyrie Bitcoin Strategy ETF (BTF), though shares sliding on the session. Valkyrie's debut coming after the first ETF, ProShares Bitcoin Strategy ETF, opened on the New York Stock Exchange on Tuesday.

In less than a week, ProShares has amassed more than a billion in assets under management, certainly no small feat. Just underscoring how much excitement and ease with which investors are hoping to gain access to Bitcoin through an ETF without having to go to an actual cryptocurrency exchange to gain access to the outright coin.

LEAH WALD: I think that even though the adoption is growing in the US for Bitcoin, for Bitcoin products, whether they're private placements or the success of the ETFs this week, I still think that there are barriers to owning physical that are a bit insurmountable, especially for institutions right now. So I think that these ETFs are going to very much alleviate that.

JENNIFER SCHONBERGER: There are still several ETF applications awaiting approval from the SEC, though funds like Valkyrie and Grayscale are hoping that the success of the Bitcoin futures ETFs could give the SEC confidence to one day open the door to allow them to offer ETFs that invest in the outright Bitcoin as opposed to the futures.

Now these Bitcoin future ETFs could be ushering a whole new class of investors that could push the price of Bitcoin higher. A veteran crypto investor Dan Morehead who is CEO of Pantera Capital, which has about $6 billion in assets under management, told "Yahoo Finance" earlier today that he thinks the price of Bitcoin could double or even triple in the next couple of years, Seana.

SEANA SMITH: All right, Jen, thanks so much for bringing us that. So with so much excitement around crypto, many investors want to add it to their portfolio. Some who are saving for retirement are asking whether or not crypto should play a part in their retirement portfolio?

So as part of our weekly retirement series brought to you by Fidelity Investments, we want to bring in Tyrone Ross Jr. He's the CEO and co-founder of Onramp, which advises financial advisors on cryptocurrencies. So Tyrone, tell us what you think. Is it smart to add this to your retirement portfolio or is it simply just too risky?

TYRONE ROSS JR.: I think it's some little of both, which is why financial advisors need to determine if this is suitable, which is our goal to do, and investment for clients. So one, is it an investment? Two, what are the client's goals? And three, is it accessible and cost efficient? Absolutely, they should have a place, but overall, it's not for everyone. And that's for advisors to determine based on who they work with.

- Is there any reason to be concerned? And what should we consider when-- I think it's the US Public Firefighters Pension Fund, which covers firefighters in parts of Texas, added roughly $25 million worth of Bitcoin and Ether to their portfolio.

This is not exactly like buying US bonds, which are fixed income and guaranteed. There is risk there. And the pension administrators totally understand what they're doing, do you think?

TYRONE ROSS JR.: I think they do. I think, if you look at pension funds, and I know at Onramp we have working with Federal Life to institute Bitcoin into the first annuity, so folks have been thinking about this and they've had a lot of time now to kind of work through it. And I think it does have a place after it's been properly vetted. And, no, it's not bonds, it's not stocks, it's not traditional. Can't really pour wine into old skin here.

So you need to look at a different set of metrics and valuation tools to be able to do that. And I think anyone that's allocating that type of capital have done that. And it's hard to look at the returns of Bitcoin and other crypto assets and not say, "All right, this is something we should be looking at and actively engaging with, again, after much study and research."

SEANA SMITH: Hey, Tyrone, when you talk about how people need to study and research and really know exactly what they're getting into, I'm sure that you've had many conversations where you've heard a number of misconceptions about crypto. What are some of the most common?

TYRONE ROSS JR.: The most common that I like to talk about all the time is separating the big B blockchain, Bitcoin blockchain, which is not volatile, by the way, from the little B coin, token, the price that everyone cares about and chases. The big B blockchain is a god-sent social justice, if you will, digital social justice for folks that have been shut out of the financial system forever. That is inarguable. Folks need to focus on that.

The price is insignificant here because this is technology that is going to bring 1.8 billion people into financial services and that is something everyone should be excited about.

- Why do the banks seem to be so slow, though, to use that to reach the unbanked?

TYRONE ROSS JR.: Great question. Well, the same reason why we don't have a real-time payment system here in the United States of America, which is another reason why the big B blockchain is so important. I think the banks realize they have a hold over the entire financial system and they don't need to move as quickly. But I think they do they do see what's happening here with Bitcoin and decentralized finance.

So they'll move when they're ready because they realize they can lobby and do all these other things. But you cannot control what is happening here, from a freedom, a social justice, and accessibility standpoint. They can't do anything about that. So they'll have to fall in line in short order but they'll fight it with all that they have. But eventually, they'll have to succumb to either play ball or get run over.