THE CFA Institute, which offers certification of expertise in finance, is adding blockchain and cryptocurrencies to its curriculum next year. According to a Bloomberg Report, the Institute plans to release materials on the new topics in August this year. (See also: What is a CFA?)
Readings on blockchain and cryptocurrencies will be included in a topic titled Financial technology in investment management. The Institute also adds a discussion relating to cryptocurrencies in its reading on professional ethics. The regulatory uncertainty surrounding cryptocurrencies should make them an interesting topic of study for students focusing on financial regulation. The numerous hacks and scandals in the cryptocurrency industry should also provide fertile fodder for students to study the lack of ethics in cryptocurrencies. Stephen Horan, managing director of general education and curriculum at the CFA Institute, told Bloomberg that the cryptocurrency field is “advancing faster than other fields.” “This is not a passing fad,” he said.
An education in cryptocurrencies
The CFA Institute’s decision to include cryptocurrencies and blockchain in its curriculum represents further integration of the sector. But this one could be one of the most important because it will help demystify cryptocurrencies among students.
Even though they have gained popularity in the last year, cryptocurrencies still remain a headache for most investors. This is partly because they combine two distinct but related fields: finance and computer science. The concepts underlying cryptocurrencies are those of finance but their execution relies solely on IT. The merger of two different fields has given rise to an industry that has become infamous for its opacity and difficulty in understanding. Although analyst firms have proposed different interpretations of bitcoin, there is still no standardized framework for evaluating and valuing cryptocurrencies. The rapid pace of new developments within the cryptocurrency and blockchain ecosystems, such as Lightning Network, has further complicated matters. The CFA Institute initiative must be evaluated in this context. (See also: Bitcoin is the new gold: Goldman Sachs).
The course’s focus on blockchain will also be very useful to students. “This will benefit us because there has been a huge expansion and adoption of crypto in our investment universe,” Kayden Lee, a fund analyst intern in Singapore, told Bloomberg. “But more importantly, the focus is on fintech and blockchain. How it works to improve, dismantle, or even disrupt certain sectors.
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