Q&A: Financial adviser John Sarson on why he’s bullish on cryptocurrency

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John Sarson, 41, is a crypto-evangelist.

He’s the CEO of Indianapolis-based Sarson Funds, which offers cryptocurrency-focused investments to financial advisers and accredited investors.

The company was founded in 2016 as a traditional investment firm, pivoted to crypto in 2017 and has 115 customers around the United States—up from 50 a year ago.

“We have a team of 15 [employees], and we are getting a new client almost every day,” Sarson said.

He spoke to IBJ recently—not from his office, but from what he calls the firm’s “secret location,” a house in Carmel where staffers build computers and do crypto mining.

John Sarson, Sarson Funds CEO (IBJ photo/Chad Williams)

What made you a believer in crypto?

In 2016, we were looking for … assets we could add to our regular investment portfolio, and we started researching Bitcoin. And when we saw the power behind blockchain technology [the technology that powers cryptocurrency], a lightbulb went off for us and we said, “This is going to change the way that financial firms do business.”

President Biden signed an executive order last week that directs federal agencies to examine the risks and benefits of cryptocurrency. What’s your take on this?

It is unapologetically positive for crypto, and the reason why it’s so positive is that it is … seeking to create a framework for holistic regulation, and in doing so it is assuring the long-term permanence, or maybe the long-term existence, of crypto assets as an asset category—that it will not be banned but instead regulated by the United States. … Now, it’s just a function of setting up thoughtful regulation, and that’s a game-changer.

What’s the biggest misperception about cryptocurrency?

Cryptocurrency has a bad image as being part of the dark web—and I would say that it’s not true. Current analysis indicates that only 1.5% of [cryptocurrency] transactions would be considered to be some type of purchase on the web that might not otherwise be possible—like a dark web transaction. And that number was 15% of transactions five years ago. And five years from now, it’ll probably be well under 1% because, basically what’s happening is, bona fide users or real users are crowding out all of the illegitimate uses while regulators are also … catching up with the bad actors.

Crypto is a hot topic right now. How can the average person separate truth from hype?

Everyone who wants to learn about cryptocurrency should open up a crypto account. I recommend Coinbase [a trading platform]. They’re the largest. They’re in the U.S. … they have 25 or 30 tokens on there, all of which have gone through a vetting process. So that way, they’re not scams. They may be bad investments, but they’re not scams. You know, if someone gets an email or a link in a chat room to a specific project they want to invest in—that’s very, very dangerous. … And then … they should talk to their financial adviser about what percent of their assets they think belong in this type of an asset category. Typically, financial advisers will say 5% or less. You know, it’s a risky asset category and it’s very volatile. And so, my advice to people would be to limit your exposure to only what you can [afford to] lose.•

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