Source: 2026 Hong Kong Institutional Digital Wealth Management Summit hosted by Xinhui Group
Content Organization: Techub News
This article is a full transcript of the speech by Fu Peng, Chief Economist of Xinhui Group, at the 2026 Hong Kong Institutional Digital Wealth Management Summit hosted by Xinhui Group. Fu Peng has 25 years of practical experience in the traditional financial sector, focusing on macro hedge fund business, and is one of the main beneficiaries of the financial dividends of the previous era. In his speech, he steps out of pure theoretical discussions, using history as an entry point combined with his own professional experience, to interpret why traditional finance pays attention to crypto assets, the development stage of crypto assets, and future trends, breaking down the core logic of "FICC + C" to clear the market fog for industry practitioners and observers, clarifying the underlying logic of the integration of crypto assets and traditional finance.
Core Reasons for Traditional Finance's Interest in Crypto Assets
The traditional finance sector is closely monitoring and tracking the trends of the entire crypto asset market. Of course, my purpose for giving this speech today is quite simple; I am just going to tell you a story from history. For me, I actually belong to the main beneficiaries of the previous era's dividends. You might feel that my title is economist, but in reality, I am not a scholar. My true core experience, what I have been doing for the past 25 years, is the macro hedge fund in the traditional sense that everyone understands.
So you must be wondering: why are people and money in traditional capital and finance starting to pay attention to crypto assets? I have been mentioning for more than a year that the future must be FICC + C, meaning that asset allocation will incorporate crypto assets into this critical sequence. Many people want to know why, so I would like to take this opportunity to briefly share with you. Once you understand this logic, you already have the answer in your heart regarding how the market will move and how asset prices will behave. Today, I will help you break through this layer of window paper.
The Birth of FICC and the Reconstruction of Finance by Technology
The timeline needs to be traced back to the origin of FICC asset class, around the late 1970s to early 1980s. Over the past decade, everyone here has become very clear that the overall framework and pattern of our world are undergoing significant changes. This change is most similar to the period after World War II in the 70s and 80s. Earlier, Xiao Feng mentioned artificial intelligence, and all the guests are discussing AI integration; it represents important technological progress and productivity leap. Every round of technological and productivity advancements reshapes various industries, including all business forms, and of course, it inevitably includes the financial sector.
Finance is not static; it is certainly not like what you see in films like "The Big Short" or "The Wolf of Wall Street": traders on the floor wearing vests shouting orders. It seems to retain historical traces of on-floor quoting in places like the New York Stock Exchange, Chicago Exchange, and London LME. Indeed, that was the most traditional finance before the 60s and 70s: traders wore vests to quote prices, and used typewriters and punch machines to complete transfers, trades, and payments. For many people in the Chinese-speaking world, the impression of trading may still linger on watching ticket machines in stock halls and filling out forms to pass to counters, which were then transmitted by staff to execute deals at the exchange. However, finance and trading have not remained in that era. The biggest change in finance must occur with technological advancements.
The previous technological advancement cycle, represented by semiconductors, computers, personal computers, systems, Windows, etc., around the late 70s and early 80s, reconstructed a new business model in finance. The well-known FICC asset class trading integrates financial assets such as interest rates, commodities, exchange rates, and stocks. The true birth of FICC was in the early 1980s.
In the 1970s, we already had the pricing theory of financial derivatives, such as option pricing, the Black-Scholes model, etc., which everyone should have learned in school. But think about it: without the widespread popularization of computers, how could the pricing and quoting of a financial derivative or asset, which takes ten to twenty minutes to calculate, complete quoting, trading, and execution? After 1985, it was not until today that professional investors and institutions began to use Bloomberg terminals. I started using systems like Reuters 3000, and later Reuters XLR, ICON during the Asian financial crisis in 1997-1998.
In other words, it was the computer, semiconductor, information technology, and data age that created the subsequent FICC system: there were asset classes, inter-asset integration, cross-asset trading, hedge funds, program trading, and well-known superstar funds. Without this round of productivity progress, finance would still remain in what many ordinary people believe to be the era of "traders as floor hands, calling orders."
At that time, JPMorgan became the biggest leader in the field of financial derivatives. Blythe Masters, a Cambridge graduate hired by JPMorgan, was one of the founders of the entire FICC market and turned the FICC business into the most profitable revenue source for mainstream financial institutions on Wall Street. This is of course tied to the global turmoil of the 70s and 80s. Remember one thing: the starting point of technological progress is often also the starting point of world turmoil. Technological advancement at certain stages coexists with the upheaval of world systems and orders.
In the 70s and 80s, we experienced the Cold War, the Middle East wars, the dollar and oil crises, skyrocketing gold prices, and the collapse of the Bretton Woods system. But human civilization is always coexisting with risks and opportunities. On one side is the chaotic world order, and on the other side, computers, semiconductors, and information technology are emerging. I used to joke: there was a strange investment portfolio during that period—betting on humanity's future and betting on humanity's lack of future, both could make money.
The Similarity between Current Crypto Assets and the FICC of the Past
Let’s recall that starting from around 2019, are you holding assets that "represent humanity's future" and "hedge against humanity's lack of future" simultaneously, all the way up to now? And today, everyone realizes: AI, artificial intelligence, data, and computing power will become the most important productivity of the next era. The first half of this game is the traditional paradigm that everyone recognizes.
Why do I talk about this history? Because nothing is permanent; everything is constantly evolving, restructuring, and rebirthing. I once stated that the moment I entered this circle and proposed FICC + C, might be an important historical moment, just like JPMorgan and Blythe Masters established the FICC. This could be a significant historical turning point: signaling the end of the early development stage of crypto assets over the past 10-15 years and the arrival of a new development stage.
Between the two stages, the structure of investors, participants, market systems, and rules of the game will undergo dramatic changes, and they are already occurring. During a recent interview, I mentioned that many familiar ways of thinking and operating from the past 10-15 years may experience significant changes. If you have been in the traditional finance sector long enough, you completely know what will happen next.
Just like in China back then, there were many exchanges set up by financial offices across various regions and various financial assets. Later, as compliance improved, the process of survival of the fittest occurred, with the remaining gradually financialized and derivative-based, being incorporated into the asset portfolios of financial institutions. The crypto asset market is undergoing exactly the same process. Today, people find commodity trading very commonplace, but before the 1980s, financial derivatives for commodities were not widespread; most people could not trade assets like copper, aluminum, zinc, and crude oil at all. Nowadays, everyone finds it convenient to trade exchange rates; it wasn't like that back in the day; today, trading government bonds and interest rate futures is also not how it used to be. This feeling is reminiscent of around 2009 when the domestic market just started having index futures, options, and derivative markets. If you have this feeling, it indicates you understand: the logic is exactly the same.
Turning Points in the Development of Crypto Assets and Personal Observations
Back then, technological advancement drove the traditional finance sector towards the integration of FICC; today, data, computing power, and artificial intelligence, coupled with underlying cryptographic technology/blockchain technology, are once again restructuring finance with technology at the core. In the past, we were always observing, but to be honest, we wouldn't participate fully early on. I used to joke that early on it really required some faith, some fundamentalism; people needed to believe in this narrative. But truly large capital would not excessively participate in such "faith trading" early on. Only when the market matures and certainty arises will it be incorporated into the asset management framework.
For example: would large financial institutions in the past incorporate red beans and green beans into asset allocations? Impossible. But today, copper can be made into futures, options, and ETFs and incorporated into investment portfolios. The entire ecosystem of the crypto industry is undergoing a similar transformation. In 2022, it was my first time deeply communicating with some big players in this circle. The connection originated from an interview in 2021 when Bitcoin was priced around $70,000. The reporter asked for my views. I am very direct in my personality, and I said: according to our traditional macro framework, we really can't understand you guys' "faith narrative," we do not acknowledge it, and we have our own way of explaining it. The functions like value storage you mention, we would interpret using our own framework, but I believe the time for intervention had not yet arrived; my understanding and model were not fully formed.
But I had a feeling: at that time, the U.S. CFTC had clearly defined Bitcoin as a commodity, a tradable financial asset. Based on this definition, I could use traditional frameworks to understand its attributes. I said at the time: I would blindly guess a conclusion—if liquidity tightens significantly in 2022, high-valuation assets in the traditional asset circle would experience substantial devaluation; if my understanding of crypto assets is correct, it too would similarly undergo a liquidity-driven valuation decline. I guessed it would drop by half. Later in late 2022, Bitcoin dropped to over $20,000, and many people in the circle came to see me because they suddenly realized: the era might have changed.
After communicating over the past few years, I found that many genuine crypto industry giants are very similar to the big shots in traditional finance back then: initially rough around the edges, all have gone through phases of "going all in to turn a bicycle into a motorcycle." But those who can move into the future will rapidly assimilate and complete their transformation during pivotal moments in times, while those who cling to past experiences will likely be eliminated by the era. My personal observation is that 2025 and 2026 will be the turning point in the field of crypto assets.
The Fusion of FICC + C and the Importance of Compliance
When people came to engage back then, the essence was mutual learning: you shared your narrative while I absorbed, integrated, and reinterpreted it from a traditional finance perspective; I presented my macro logic, and we all embraced compatibility and inclusiveness. After years of integration, a new system has already formed. Including the recent liquidity tightening at the end of last year which prompted valuation compression, repeating the exact same trend in the crypto market indicates that we are on the right path. This inclusivity and integration will eventually result in a situation where there is no distinction. Just like how Wall Street traders who only dealt with stocks eventually merged with institutions handling FICC asset classes. The future will undoubtedly be FICC + C without such clear separations.
For us, the critical point on the other side is compliance. The year 2025 is an important milestone: whether it is the stablecoin bill or the certainty bills related to digital assets/crypto assets, the two key legislations have already provided answers to the market. Moving forward, you will see traditional financial institutions on Wall Street entering rapidly. Crypto assets will become part of a diversified asset reserve, just like diversified foreign exchange reserves. Transitioning from single reserve/trading asset to diversification: just as we once incorporated commodities, exchange rates, and interest rates, today we are including crypto assets.
But remember: when it truly integrates into the traditional financial system, the market logic announces that the new era has arrived, and the old era has ended. Since the 1980s, the proportion of individual participant involvement in the U.S. stock market has continued to decline, while the institutional proportion has continued to rise. This is the inevitable path for any market moving towards maturity. Is the crypto market not also following this path? The answer is certainly yes.
Positioning and Trends of Crypto Assets
Stablecoins will separate the payment functions of crypto/blockchain technology. So what exactly is Bitcoin? A reporter asked me: is it digital gold? I said this statement is controversial because it depends on how it is defined. For professionals, they understand it immediately; but for ordinary investors, the first reaction is physical gold. The accurate definition of gold should be: an asset class that has value storage function and can be scaled for financialized trading.
Some assets have value, but do not necessarily have the characteristics of large-scale financialization and tradability. For example, limited edition sneakers, collectibles, Richard Mille watches, antique walnuts, orchids... They hold emotional and collectible value but are hard to become standardized, financially configured assets. Now, the standard definition of crypto assets is already very clear: the development path of Western society is clear: "what is not prohibited by law is permissible," encouraging innovation and exploration. Just like how financial derivatives started with demand and created business first, then regulators followed, regulating at different levels, and ultimately maturing. Financial innovation leads, compliance follows, and gradually matures; crypto assets are following exactly the same logic.
Now the question is: is the certainty of financial regulation in place by 2025? My answer is: yes. The future landscape will be very clear: in technical applications and payment aspects: stablecoins; Bitcoin and other core targets: designated as assets with value storage functions and tradable financialization. This definition may upset the fundamentalists of the previous era, but this is the trend of the times, and there's nothing to be done about it.
Crypto Assets Have Matured to Be Included in Mainstream Asset Portfolios
With this closed logical loop, Wall Street can fully intervene. A brand new chapter is about to begin. I do not know if my speech today will be historical, of course, I hope it could be and spark some thoughts in everyone. I believe it can also answer many people's questions: why would a traditional "old-school" practitioner in FICC enter such a new industry? The answer is: you have matured to the point where you can be included in mainstream asset portfolios.
My sharing ends here, thank you all.
Once again, let's give a warm round of applause to Vice President Fu Peng for his wonderful sharing; please stay for a moment. Now, we will witness a historic moment together.
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