Fu Peng's Speech Transcript: As a veteran of traditional finance, why did I start embracing the crypto world?

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On April 23, at the 2026 Hong Kong Institutional Digital Wealth Management Summit Forum, Xinhuo Group’s new Chief Economist Fu Peng delivered his first speech after taking office.

He stated that, embracing the essence of traditional finance veterans into the crypto space is similar to how computer technology reshaped traditional finance back in the day, and now AI and blockchain are driving a new wave of transformation. In the future, traditional finance and crypto assets will fully integrate, moving toward a new era of “FICC+C.”

Below is the full speech:

These days, many people are asking me frantically: why have I gotten so close to the crypto world?

Actually, this opportunity started around 2022, so it’s been about four years now. As a practitioner in traditional finance, we have been closely monitoring and tracking the entire crypto asset market’s developments.

The main reason I’m giving this speech today is quite simple: I just want to tell everyone a story from history. For me, I am one of the main beneficiaries of the last era’s boom. You might see my title as “Economist,” but I am not a pure scholar.

Over the past 25 years, my core experience—what we have been focusing on—is what everyone understands as traditional hedge funds. You might be curious: why are these traditional capital and financial sector people and funds starting to pay attention to crypto assets?

In the past year or so, I have repeatedly mentioned a point: the future must be “FICC+C,” meaning the traditional major asset allocation (FICC) will be combined with crypto assets (Crypto). Many want to know why, so I’ll take this opportunity to share a simple explanation. Once you understand this logic, you might already have an answer in your mind about how the market will evolve and how asset prices will move.

Today, I will help everyone break through this barrier. We need to trace back to the origin of the FICC asset class—roughly the late 1970s to early 1980s. Over the past decade, everyone here has clearly recognized that the overall framework and pattern of our world are undergoing huge changes. And this change is most similar to the period after World War II, specifically the 1970s to 1980s. For example, just now, Xiao Feng mentioned artificial intelligence, and all the guests also talked about AI integration. As a major technological advancement and productivity boost, every leap in technology and productivity reshapes all industries.

“All industries” includes all sectors, naturally including finance. Finance is not static. It’s definitely not like what you see in movies like “The Big Short” or “The Wolf of Wall Street”—traders in vests shouting orders on the trading floor. Or, when some people visit the NYSE, they might still think finance is just people quoting and executing trades on the floor. Indeed, many reporters still like to use such scenes as background for news reports. If you go to Chicago, to the earliest interest rate derivatives markets, or to the London Metal Exchange (LME), you can still see traces of this history. Yes, that was the most traditional finance before the 1960s and 70s. People quoting in vests, using typewriters and punch cards to complete transfers, trades, and payments.

For most Chinese speakers, the impression of trading still might be watching the roulette wheel in the stock hall, staring at prices, filling out orders, and handing them to clerks who then call the exchange via dedicated lines to complete transactions. But not all finance or trading remains in that era; the biggest transformation in finance has always been driven by technological progress.

In the last cycle of technological advancement, centered around semiconductors, computers, personal computers, DOS systems, Windows, and so on, the productivity and technological progress reconstructed new forms of finance in the late 1970s and early 1980s. Today’s well-known FICC asset trading, simply put, involves integrating interest rates, commodities, exchange rates, stocks, and other financial assets, and FICC was born in the early 1980s. In the 1970s, we learned about derivatives pricing, like the Black-Scholes model for options. But imagine: without the large-scale application and popularization of computers, quoting and pricing a derivative or financial asset would take ten, twenty, or even over half an hour of manual calculation. How could we efficiently quote and execute trades under such conditions?

From 1985 onward, professional investors and institutions began widely using Bloomberg terminals. I probably started using Reuters 3000 during the Asian financial crisis around 1997-98, followed by Reuters Extra and Eikon. In other words, it was the advent of computers, semiconductors, information technology, and data that created the later FICC. This gave us richer asset classes, asset fusion, cross-asset trading, hedge funds, algorithmic trading, and well-known “big-name” funds. Without this productivity boost, finance might still be stuck in the image of traders in vests shouting orders.

During that period, JP Morgan on Wall Street became the leader in derivatives. They hired Cambridge graduate Blythe Masters, who became a foundational figure in derivatives and FICC markets, turning FICC into the most profitable segment for Wall Street’s mainstream financial institutions.

Of course, all this was also linked to the turbulence of the 1970s and 80s. Remember: the origin of technological progress often coincides with world upheaval. At certain historical junctures, technological leaps are always accompanied by upheavals in global systems and order.

In the 70s and 80s, we experienced the Cold War, Middle East conflicts, the dollar-oil crisis, soaring gold prices, and systemic decoupling. But human civilization always advances amid risks and opportunities.

While the world order was in chaos, our computers, semiconductors, and information technology rose rapidly. I used to joke that, back then, there was a strange investment portfolio: holding assets representing the future of humanity and assets hedging against humanity’s lack of future at the same time.

Think back—no need to go back ten years, just around 2019—you might find your own investment portfolio also holding assets representing “the future of humanity” and “the lack of future,” right?

Today, as we all realize that AI, data, and computing power will become the most important productivity factors in the future and the next era, this “game” is already more than halfway through. And this first half is what we recognize as the traditional “crypto circle.”

Why do I mention all this?

Remember, nothing is static; everything is constantly being reconstructed and reborn through development.

So, when we talk about entering this space—meaning the “FICC+C” era—I don’t know if this will leave an important mark in history, just like Blythe Masters’ mark on FICC. Could this be a pivotal point, signaling the end of the early 10-15 years of development and the beginning of a new phase?

In this transition, investors, participants, market systems, and rules will undergo huge changes—or rather, they already are. As I mentioned in an interview earlier, the paradigms and mindsets you’ve been familiar with over the past 10-15 years may be fundamentally overturned in the future.

If you’ve been in traditional finance long enough, you can foresee what’s coming. Just like in China’s past, where large exchanges were set up by provincial financial offices, with vast financial assets. But as regulation and compliance strengthened, the process of “survival of the fittest” meant only the best assets remained within financial institutions’ portfolios. The same process is happening in the crypto market.

For example, today, commodity trading is commonplace. But before the 1980s, derivatives for commodities were not widespread, and most people couldn’t trade them meaningfully.

Now, trading copper, aluminum, lead, zinc, palm oil, and others seems normal. But back then, it wasn’t.

Now, trading exchange rates is very convenient. But that was not the case before.

Today, we can easily trade government bonds and interest rate futures. But that was also unavailable then.

Does this feel like when we first introduced stock index futures and options around 2009? If you have that feeling, you’ll understand that we are at a similar historical juncture. Back then, technological progress drove the transformation and integration of traditional finance into FICC. Today, the same logic applies, but the driving force has shifted to data and computing power.

AI, combined with underlying encryption or blockchain technology, is reconstructing finance through technology. Our financial industry is undergoing profound change, which we have been closely watching. But honestly, in the early days, we wouldn’t participate at all. I often joke that, in early stages, this space really needed “faith,” some so-called “fundamentalism.” But true capital wouldn’t over-participate in such “faith trading” early on. Capital only enters when the market matures and becomes more certain.

For example, in the past, would major financial institutions include red beans or green beans in their asset allocations? Impossible. But today, we can turn copper into futures, options, ETFs, and include it in portfolios. This process of formalization and financialization is very similar to what’s happening in the crypto asset ecosystem.

2022 was the first time I truly interacted with the big players in this space—an encounter by fate. It started from a comment I made during an interview in 2021, when Bitcoin was around $70k. When asked my opinion, I was straightforward: based on traditional finance frameworks, we simply couldn’t understand what this asset really was. The faith-based narratives we don’t accept; we have our own explanations. For example, its value preservation function—how do we interpret that? Using traditional finance language and frameworks. At that time, I thought we weren’t ready to get involved.

I said we were observing but not fully understanding the logic or valuation models. But I had a feeling. When asked what that feeling was, I said it came from the fact that, by then, the U.S. Commodity Futures Trading Commission (CFTC) and other regulators had already officially classified it as a commodity, a tradable financial asset. For me, that was simple: I could interpret its asset nature based on this official definition.

I also guessed: if, in 2022, macro liquidity tightens significantly, it’s easy to see high-valuation assets in traditional markets undergo large-scale “devaluation” episodes. If my understanding of crypto assets is correct, they will also experience similar devaluation amid liquidity tightening. I guessed it might drop by half. That’s why, by the end of 2022, when it really fell below $20,000, many in the crypto world came to find me, realizing: has the era changed?

Over the past few years, I’ve found that many true crypto bigwigs are actually similar to the old-school traditional finance giants. In early industry days, everyone’s development was rough and wild. Think back—early Chinese commodity futures traders, weren’t they all rough and aggressive? Did anyone not have to “fight for a chance, turn a bicycle into a motorcycle”? But those who truly succeed are those who, at the “turning point”—note, not “transformation,” but “turning point”—can quickly absorb new things and pivot. Clinging to early experiences will only lead to obsolescence, because “the times shape you, and they will also eliminate you.”

My personal view is that 2025 to 2026 might be the pivotal moment for a historic shift in crypto assets. When industry leaders come together, it’s mainly about mutual learning. You tell me what you think crypto assets are, and I’ll absorb and integrate from a traditional finance perspective; I’ll reinterpret this asset class. Meanwhile, I’ll explain how traditional finance uses existing paths and logic to understand these assets.

Years of mutual inclusion and integration have already formed a new system. Over the past few years, including late last year, macro liquidity tightening has squeezed valuations, and stories in the crypto space have again synchronized with traditional markets. What does this show? That our path is correct. Inclusion and integration will ultimately lead to no distinction. Just like in the 70s and 80s, traditional stock traders in “The Wolf of Wall Street” and those doing FICC asset allocation eventually blurred into one. So, the future will be an era of “FICC+C,” with no clear boundary between traditional finance and crypto assets.

Of course, for traditional financial institutions, the most important thing is compliance. By 2025, it will be a crucial year. Whether it’s the stablecoin legislation or the clear regulatory laws on digital and crypto assets we see emerging, these key laws already tell us the final answer. At that point, the logic is simple: in the future, Wall Street financial institutions and traditional giants will rapidly enter this market. Just like diversifying foreign exchange reserves, institutions will include crypto assets as part of their diversified asset reserves, shifting from single reserve or trading assets to a diversified portfolio. Back then, we added commodities, exchange rates, interest rates; today, we can similarly include crypto assets. Remember: when this integration truly happens, the underlying market logic will declare the arrival of a new era, and old habits will be completely left behind.

Looking back, after the 1980s, retail participation in the US stock market gradually declined, while institutional participation increased. This institutionalization trend will also occur in any market moving from early to mature stages. Is the crypto market at that stage now? My answer: yes. Stablecoins have already separated the payment function of blockchain technology (or blockchain tech). So, think about it—what exactly is Bitcoin?

A reporter just asked me if Bitcoin is “digital gold.” My response might be controversial. Why? Because it depends on the listener’s understanding level. For example, if you tell me “digital gold,” I immediately understand what you mean; but if you tell an average investor, their first reaction might be physical gold. So, what is gold? We can only give it a full definition: it’s a tradable commodity asset with value preservation function.

Some assets, though they have value preservation, may not be widely financialized or tradable. For example, my son’s AJ basketball shoes—do they have value? The understanding of “value” varies greatly. Or collectible figurines—do they have value? Richard Mille watches—do they have value?

First, if “value” here refers broadly to worth, then no problem: emotional value is also value, companionship is also value. But do they have the capacity for large-scale financialization and trading? Not necessarily. Ask those old-timers who like to string beads—do their wooden sticks have value? Walnut trees? Peace lilies? If you say they have no value, that’s wrong—under broad definitions, they do have value; but if you mean value in terms of financialization and tradability, then claiming they have value is also incorrect, because they lack those attributes.

Therefore, giving any asset a complete and accurate definition is very important. Currently, regulators’ standard definitions of crypto assets are very clear. The core path of Western financial development is straightforward: “Where there’s no prohibition, it’s allowed.” It encourages innovation and exploration. You start doing it—just like developing derivatives back then. When we saw demand for options and swaps, but lacked the market and regulation, we just started. After doing it, compliance gradually caught up, and the market matured step by step. The entire history of Western finance is a process of “financial innovation—regulatory follow-up—maturity.” Crypto assets are following the same logic.

Now, you need to judge: by 2025, has the certainty of regulatory follow-up already emerged? My answer: yes. In the future, you’ll see blockchain applications in trading and payments as stablecoins. And what about Bitcoin? It will become a “value-preserving, tradable asset,” which is the most comprehensive definition. Of course, I know this definition will upset some “fundamentalist” thinkers from the old era. But I want to tell everyone: this is the inevitable trend, a logical evolution aligned with modern finance. At this stage, traditional Wall Street capital can fully participate.

A new chapter is about to begin. I wonder if today’s speech will be recorded in history? Of course, I hope so, or at least provoke some reflection. I believe this also answers many questions: “Fu, as a veteran in traditional FICC, why are you crossing over into our new industry?” I want to say: because your industry has matured enough to be included in traditional investment portfolios.

That’s all I wanted to share today. Thank you all!