What former CFTC Chairman Chris Giancarlo tells his own children about buying their first crypto coin Chris Giancarlo, the former chairman of the U.S. Commodity Futures Trading Commission, who’s also known as “CryptoDad,” says he does not directly own any crypto. He decided while he was writing the agency’s crypto rules that he would not benefit from them, and he has kept to that position since he left the CFTC.
He acknowledges that he invests in crypto-infrastructure companies and serves as an adviser and independent director at companies that build crypto applications, some of which hold crypto in their corporate treasuries, so he could benefit indirectly if crypto prices rise. Giancarlo served as chairman of the CFTC from 2017 to 2019 and co-founded the nonprofit Digital Dollar Project. He is the author of “CryptoDad: The Fight for the Future of Money” and the new book “The New Adventures of CryptoDad: The Quest for Financial Freedom in the 21st Century.” How to navigate a market that hinges on just a handful of companies Play video: How to navigate a market that hinges on just a handful of companies In this interview, edited for length and clarity, Giancarlo shares how much bitcoin major institutions recommend, whether 401(k) plans should offer crypto, whether stablecoins are as safe as bank deposits, how ordinary investors lose money and what he tells his own children about buying their first coin.
Don’t Short Yourself offers weekly money tips to help you earn it, stack it and grow it. I would like to receive updates and special offers from Dow Jones and affiliates. I can unsubscribe at any time. **Market **Your new book is about financial freedom, so what can crypto actually do for an American with a mortgage and a 401(k)? **Giancarlo:**If you want to access what you think of as your money, you’ve basically got to go to a financial institution and say, “Make good on the IOU that you have.” But it’s not the same thing as having direct access to your things of value, which you have with crypto, which you will have with stablecoins. **Market **How much bitcoin should an investor in their 40s hold in a long-term portfolio? **Giancarlo:**I think most major institutions now are recommending treating it like an alternative, high-risk asset and are recommending, I think, anywhere between 2% and 5%.
I think that’s about right. **Market **Bitcoin is trading well below its 2025 high, so why does it behave like a speculative investment right now? **Giancarlo:**In advance of any technological change, there’s always a speculative aspect of that change. When the railroad first came to North America, it was a tremendously transformative technology. Yet it was accompanied by some wild speculation in railroad stocks, and some fraud and manipulation.
That led eventually to a bust and a stock-market crash in those railroad stocks. But you know what happened? When the railroad stocks crashed, nobody went and ripped up the rails and said, “Let’s go back to horses and carriages.” > ‘When the railroad stocks crashed, nobody went and ripped up the rails and said, “Let’s go back to horses and carriages.”’ **Market **Even with that risk, is there a case for owning bitcoin, and how should a cautious investor treat it? **Giancarlo:**With bitcoin, uniquely among all these cryptos, it also is a debasement trade.
If you believe, and not unreasonably, that the U.S. government is going to continue to issue debt and debase our currency , then owning bitcoin, which has programmed scarcity, is a good hedge against inflation and dollar diminishment. _(Editor’s note: A debasement trade is a bet that the dollar will lose buying power. Bitcoin’s supply is capped at 21 million coins.)_ As a former regulator, I’m not in the business of giving investment advice. I always shy away from the speculative, number-go-up kind of excitement.
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