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Download the CFA Institute Research Foundation guide to cryptoassets and blockchain to learn about cryptocurrency basics, crypto trading, cryptoasset regulations, and more.

Cryptoassets: The Guide to Bitcoin, Blockchain, and Cryptocurrency for Investment Professionals

Read the full Brief (PDF)


Bitcoin, blockchain, and cryptocurrencies burst onto the world stage in 2008, when the online posting of a pseudonymous white paper provided a vision of a new way to transfer value over the internet.

In the decade-plus since, the cryptoasset market has gone through all the classic phases of a disruptive technology: massive bull markets and crushing pullbacks, periods of euphoria and moments of despair, FOMO (fear of missing out), fear, and everything in between.

As the cryptomarket enters its second decade, one thing is clear: Crypto is not going away. Cryptoasset markets are rallying toward new all-time highs, and many of the world’s largest investors and financial institutions are getting involved.

Investors looking into crypto, however, face significant challenges. The quality of information is poor. Theories about the drivers of cryptoasset valuations are untested and often poorly designed, and they are rarely—if ever—published in peer-reviewed journals. Due diligence efforts from leading consultants are in their infancy, and few people have carefully thought through the role (if any) that cryptoassets should have in a professionally managed portfolio.

More fundamentally, few people even understand what crypto really is or why it might matter. Is it an alternative currency? A technology? A venture capital investment? A specious bubble?

The goal of this document is to provide the inquisitive investor with a clear-eyed guide to crypto and blockchain: what they are, what they are not, and where they might go from here.

This brief covers topics such as:

  • How Crypto Works and Why It Matters
  • Understanding Bitcoin
  • How Bitcoin Transaction Works
  • Why Does More Than One Cryptoasset Exist?
  • Bitcoin vs. Ethereum
  • Bitcoin vs. XRP

...and more.

About the Authors

Matt Hougan
Matt Hougan

Matt Hougan is one of the world’s leading experts on crypto, ETFs, and financial technology.

He is Chief Investment Officer for Bitwise Asset Management, creator of the world's first cryptocurrency index fund. In that role, he helps create the index methodologies that underlie Bitwise’s investment products, and conducts fundamental research into the role cryptoassets can play in a diversified portfolio.

A three-time member of the Barron’s ETF Roundtable, Hougan was previously CEO of ETF.com, where he helped create the first institutionally oriented ETF classification and ratings system. Hougan led the sale of that business in three transactions to FactSet, BATS, and Informa, in 2015 and 2016.

He was also Chairman and CEO of Inside ETFs, the world’s largest ETF conference, where he helped guide efforts to educate financial advisors on the role ETFs and index-based investments can play in building efficient portfolios.

Hougan’s thoughts on investing have been widely profiled in the media, including in Barron’s, Bloomberg, The Wall Street Journal, The New York Times, Institutional Investor, CNBC, and the Financial Times. He is co-author of two publications for the CFA Institute Research Foundation: “A Comprehensive Guide to Exchange-Traded Funds,” published in 2015, and “Cryptoasset: The Guide to Bitcoin, Blockchain, and Cryptocurrencies For Professional Investors.” A crypto columnist for Forbes, Hougan has been featured on Bloomberg’s “Masters of Business.”

Hougan serves on the Board of Directors of Equbot, creator of the world’s first artificial-intelligence-driven family of ETFs, is a co-founder of Advisor Circle, a product studio for growth-oriented financial advisors, and is a strategic advisor to a number of firstm, including Blockworks and StratiFi.

He graduated from Bowdoin College with a B.A. in philosophy.

David Lawant

David Lawant is a researcher at Bitwise Asset Management.