In the ever-evolving world of cryptocurrency, it’s always insightful to hear from those deeply involved in the industry. Today, we spotlight Unbiased Portfolio Management Inc., which has made significant strides in crypto investing. We had the pleasure of speaking with John Amonson, the CEO, and Yan Li, the company’s Chief Investment Officer and Portfolio Manager.
John Amonson, with his German ancestry, has a unique perspective on the value of currency, shaped by his grandparents’ stories of hyperinflation in Germany. Outside of his professional life, he enjoys restoring vintage cars and playing drums in a rock band.
On the other hand, Yan Li hails from northern China, bordering North Korea. His rich cultural heritage blends Han, Mongolian, and Manchurian. With over a decade of experience in portfolio management and a Chartered Financial Analyst (CFA) designation, Yan brings a wealth of knowledge.
John’s introduction to Bitcoin came in 2013 when a client proposed the idea. Despite his initial interest, he was outvoted by his investment committee and had to put his professional interest in Bitcoin on hold. However, he kept an eye on cryptocurrency, and when it gained popularity, he advocated for its inclusion in Unbiased’s product offerings.
Yan’s crypto journey started a bit later, in 2021, with the launch of the first ETF. He began allocating crypto ETFs in his TFSA/RRSP accounts.
For most of Unbiased’s client portfolios, Bitcoin is held through an ETF. After careful consideration, they decided on an initial target allocation of 3%. However, some clients have chosen to go beyond this percentage. John explains that the risk is less than a year’s portfolio income even if Bitcoin plummeted to zero. At the same time, the potential upside is significant if Bitcoin fulfills its promise as a transformative technology.
Yan’s investment thesis on Bitcoin is four-fold:
Self-Sovereign Asset: Bitcoin is independent of any external entity, providing individual self-sovereignty. It’s akin to burying gold in one’s backyard, ensuring security. Bitcoin also offers high divisibility, mobility, and verifiability benefits.
Debasement Hedge: Bitcoin safeguards against debasement in the face of growing global debt. The risk of sanctions discourages foreign buyers from investing in US debt, leaving the Federal Reserve as the primary purchaser relying on printed money.
Disruptive Technology: Bitcoin’s Lightning network offers efficient payment solutions that outperform traditional payment methods. It also provides faster, cheaper, and safer international wire transfers.
Apex Investment: Bitcoin has a favourable risk-reward profile. It has shown an annualized return of 55% since 2014, providing leveraged-like returns without actual leverage. Today, Bitcoin is a compelling investment option for many young people due to its potential returns and no minimum upfront cost.
Yan believes replacing the current fiat system with Bitcoin is unnecessary in the developed world. However, in regions like El Salvador, Africa, and parts of Asia, where there are no properly functioning fiat currency systems, Bitcoin could be a viable alternative.
On the other hand, John feels that the energy consumption associated with Bitcoin mining needs to be more understood. The energy used in mining contributes to the security of the Bitcoin network, its proof of work status, and its inherent value.
For those interested in deepening their understanding of Bitcoin, John recommends two books: “The Bitcoin Standard” by Saifedean Ammous and “Softwar” by Major Jason P. Lowery.
Unbiased Portfolio Management Inc. is a testament to the potential of cryptocurrency in the world of investment. Their journey into the crypto space, led by John Amonson and Yan Li, offers valuable insights into the opportunities and challenges of crypto investing. Their perspectives will undoubtedly remain relevant and insightful as the crypto landscape evolves.
About the Author: Taylor Amonson
Taylor comes to Unbiased Financial Services Inc. from the banking industry where he spent 3 years with RBC, leaving as Senior Account Manager. During his time with the Royal Bank he obtained his Certified Financial Planner (CFP) designation. His formal education includes a BA from the University of Victoria, which involved a one year exchange at the University of East Anglia. He also holds an MBA with Distinction from Edinburgh Business School, Heriot-Watt University.
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