Fu Peng 2026 First Public Speech: What Exactly Are Crypto Assets? Why Did I Join the Crypto Asset Industry?

Speaker: Fu Peng, Chief Economist of New Fire Group
Organizer: Eric, Foresight News

On April 23, Beijing time, at the Hong Kong Web3 Carnival held at the Hong Kong Convention and Exhibition Centre, Fu Peng, a well-known macroeconomic scholar and newly appointed Chief Economist of New Fire Group, delivered his first public speech for 2026. In this speech, Fu Peng publicly elaborated on his understanding of crypto assets and his interpretation of the position of crypto assets in the current macroeconomic environment.

I have organized the entire content of Fu Peng's speech, with some edits.

Many people have been asking me recently why I am so closely involved with the cryptocurrency and crypto asset circles. In fact, this opportunity began around 2022, and it has been about four years now.

When I was in traditional finance, I was also closely monitoring and tracking the trends in the entire crypto asset market. Of course, today I am here to give this speech, and it is quite simple; I will tell you a historical story because, for me, I belong to the main beneficiaries of the last era's dividends. So you might think that my title is economist, but in reality, I am not an academic. My core experience over the past 25 years has been in what we understand as traditional hedge funds.

You might be wondering why these traditional capital and traditional finance people or money would start to pay attention to it (crypto assets)?

In the past year or so, I have mentioned that the future must be "FICC + C", meaning that major asset allocation will include crypto assets. Many people will want to know why, so I will take this opportunity to share a bit about this. If you understand how the market works and how asset prices move, you might already have the answer in your mind, so today I will help you break through that layer of glass.

We need to trace the timeline back to the origin of FICC major assets. When was that? It was roughly from the late 1970s to the early 1980s. In the past decade, everyone here has been able to clearly recognize that the entire global framework and landscape are undergoing tremendous changes, and this change is most similar to the time points in history after World War II, which is in the 1970s and 1980s.

For example, I just saw that Xiao Feng also talked about artificial intelligence, and all the guests actually mentioned the integration of AI. As an important technological advancement and productivity, every round of technological progress and productivity improvement will reshape various industries. This includes all sectors, and of course, it will inevitably include the financial sector. Our finance is not static; it is definitely not.

For instance, the portrayal of finance in movies or TV shows like "The Big Short" or "The Wolf of Wall Street" shows people in vests shouting orders on the trading floor, or if you go to the New York Stock Exchange, many people still think finance is about quoting and trading on the floor. Of course, many journalists still prefer to use this background of floor trading for news reporting.

If you go to Chicago to see the early interest rate derivatives market or the London Metal Exchange (LME), you will still see traces of this history. Yes, that was the most traditional finance, which can be said to be finance before the 1960s and 1970s. People were quoting in vests and completing transactions through typewriters and punch machines. For most Chinese people, the impression of trading is watching the so-called flipping machines in stock halls, filling out orders, and handing them to the counter, while a young lady uses a dedicated phone line to complete the transactions.

Not all finance or trading remains in that era; the biggest changes in finance must occur with technological advancements.

So in the last cycle of technological advancement, represented by semiconductors, computers, personal computers, DOS systems, Windows systems, etc., it restructured our financial landscape. The major asset trading that everyone is familiar with today can be simply described as the integration of interest rates, commodities, exchange rates, stocks, and other financial assets.

The birth of FICC occurred in the early 1980s. In the 1970s, there was pricing for financial derivatives, such as options pricing and the Black-Scholes model, which everyone should have learned in school. But think about it: without the large-scale application and popularization of computers, how could the pricing of a financial derivative or financial asset take ten, twenty, or even thirty minutes to calculate? How could I possibly complete a quoted transaction?

Starting in 1985, all professional investors and investment institutions began using Bloomberg terminals. I started using Reuters' Reuters 3000 around 1997 or 1998, during the Asian financial crisis, followed by Reuters Xtra and later Eikon. In other words, the era of computers, semiconductors, information technology, and data created the subsequent FICC.

We had asset categories, the integration of assets, cross-asset trading, hedge funds, and algorithmic trading, along with well-known products like index funds. Without this advancement in productivity, finance would still be stuck in what many ordinary people think, where traders are just people in vests shouting orders.

JP Morgan on Wall Street became the largest leader in the entire financial derivatives market. At that time, JP Morgan hired Cambridge graduate Blythe Masters, who became the foundation of the entire financial derivatives market and turned the FICC business into the most profitable part of mainstream financial institutions on Wall Street. Of course, this was inseparable from the turmoil in the 1970s and 1980s. Remember one thing: the origin of technological advancement is also the origin of global turmoil.

Thus, technological advancement at certain stages coexists with the turmoil of global institutional order. In the 1970s and 1980s, we experienced the Cold War, the Middle East wars, the dollar oil crisis, and the so-called surge in gold prices, leading to systemic decoupling. However, human civilization always walks hand in hand with opportunities and risks.

On one side, while the world order was chaotic, our computers, semiconductors, and information technology were rising. I used to joke that during that time, there was a strange investment portfolio that simultaneously invested in "humanity has a future" and "humanity has no future."

Think about it: not to mention the past ten years, starting around 2019, if you look at your hands, you probably have assets that represent both "humanity has a future" and "humanity has no future," and both are hard to come by today. Of course, by now, as we all begin to realize that artificial intelligence, data, and computing power will become the most important productivity of the next era, the entire game is actually halfway through.

The first half is what everyone recognizes as the traditional crypto circle. Why do I mention this? Because remember, nothing is static; everything is constantly being reconstructed and reborn in the process of development.

So I once said that it is very likely that the moment I entered this circle will leave an important mark in history. Just like when Blythe Masters entered JP Morgan, could it become an important node?

(This node) signifies the end of the early development stage of the past 10 to 15 years and the arrival of a new development stage. In these two stages, investors, participants, market systems, and game rules will undergo tremendous changes. Or rather, they are already undergoing tremendous changes. When I was interviewed by reporters earlier, I mentioned that many of the paradigms you are familiar with from the past 15 years, the thinking you have become accustomed to over the past 10 to 15 years, may undergo significant changes. Of course, if you have been in traditional finance long enough, you will know exactly what is about to happen. Just like in China back then, we had large-scale exchanges set up by financial offices in various provinces, and we had a lot of financial assets. However, as compliance gradually strengthened, it simply meant survival of the fittest.

Then financial derivatives will gradually be incorporated into the asset portfolios of financial institutions, and our entire crypto asset market has actually gone through the same process. For example, now everyone may be accustomed to commodities, but you should know that before the 1980s, financial derivatives for commodities were not widespread, and most people could not truly trade them.

Now, assets like copper, aluminum, lead, zinc, and palm oil are commonplace; today, everyone finds it convenient to trade exchange rates, but back then, you would find that it was also unavailable. Now we can easily trade government bonds and interest rate futures, which also did not exist back then. In fact, doesn't this feeling resemble 2009, when we started having index futures, options, and derivative products?

If you do, you will understand that this is the same time point. So the technological advancements of that time drove the entire traditional finance to transition and integrate into FICC, and today the same principle applies: data, computing power, artificial intelligence, combined with underlying technology, which is essentially cryptographic technology or blockchain technology, is at the core of reconstructing finance, and our finance is changing.

So we have been paying attention in the past, but to be honest, we did not participate at all. So I jokingly said that in the early days, it was indeed necessary to talk about faith, to talk about so-called fundamentalism, right? Everyone had to have faith in this thing. However, as real capital, it would not excessively participate in this faith-based trading in the early stages.

(Crypto assets) can only be gradually nurtured and incorporated into the asset management framework when they achieve certainty. For example, if we were trading something like red beans or green beans, do you think large financial institutions would consider it as part of asset allocation? Impossible. But today we can turn copper into futures options, we can turn it into ETFs, and we can incorporate it into the entire investment portfolio.

This transformation is actually the scenario that the entire crypto circle is undergoing. 2022 was the first time I truly began to interact with some big players in this circle. The fate began in 2021 when I said something during an interview. At that time, Bitcoin was around 70,000, but when the reporter asked me, I, being straightforward, said simply that according to our path framework, we really could not understand what this asset was.

Because everything you are talking about in terms of faith, we do not recognize. We have our own way of interpreting it, such as regarding the function of value maintenance; we will interpret it using our framework and language.

(I mentioned in the interview) that I believed we did not have the time, or it was not yet time to intervene in this asset. But I said we were indeed observing, but we still did not quite understand the things you were talking about. My understanding and model of it (crypto assets) had not yet fully formed. However, I said I had a feeling because the CFTC (Commodity Futures Trading Commission) in the U.S. had already clearly defined it as a commodity, a tradable financial asset. For me, I could easily use this definition to understand its attributes.

I made a blind guess at that time: if in 2022, with the significant tightening of liquidity, I could easily see that those valued assets in our traditional asset circle would experience a large-scale valuation kill. I said if my understanding was correct, it would bring about a similar valuation kill along with the valuation assets. I guessed that (Bitcoin would) drop by half, which is why at the end of 2022, when it dropped to 20,000, many people in the crypto circle came to me because they suddenly realized that the era had changed.

Of course, after communicating over the past few years, many of the big players in the crypto circle, whom I truly believe are like the big players in the traditional finance circle back then. In the early days, everyone was relatively rough. You can think about it, including in China, for example, the big names in commodity futures trading, who wasn't rough back then? Who didn't need to take risks to turn a bicycle into a motorcycle? However, those who can truly achieve the future will rapidly absorb and complete this transition when it is time to turn, not just transform.

If they continue to follow the old experiences, those who were shaped by the times will gradually be eliminated by the times. My personal observation is that 2025 or 2026 might be the time point for crypto assets.

You can tell me what you think it (crypto assets) is, and I will also absorb and integrate it from the perspective of traditional finance to further understand this matter. I will also tell you how I understand these types of assets through our path logic. After a few years of integration and inclusiveness, a new system has actually formed.

In recent years, including the end of last year, from our perspective, it has been the valuation squeeze brought about by a new round of tightening liquidity. The same story has occurred in the crypto asset circle. What does this indicate? It indicates that the path we are taking is correct. This inclusiveness and integration will ultimately form a situation where there is no distinction between each other, just like the traditional stock traders from the 1970s and 1980s, as shown in "The Wolf of Wall Street," and those who deal with major assets.

Therefore, the future must be "FICC + C", and there will no longer be too much distinction between you and me. Of course, for us, another important aspect is compliance, so 2025 is actually an important milestone year. Whether it is the stablecoin bill or the certainty bill we see for digital assets or crypto assets, these two important bills have already told us the answer to this market. At this point, it is simple: in the future, you will see Wall Street financial institutions, once traditional financial institutions, rapidly entering this market. Just like diversifying foreign exchange reserves, it will incorporate it into diversified asset reserves.

(Crypto assets) will transform from a single reserve asset or trading asset into diversified trading assets. Back then, I could add commodities, exchange rates, and interest rates; today, I can add crypto assets. But remember one thing: when it integrates, the market logic will announce the arrival of a new era, and it will no longer be the habits of the old era. Of course, we say that after the 1980s, the proportion of retail investors in the U.S. stock market has gradually decreased, meaning that the proportion of retail investors directly participating in the market is gradually declining, while the proportion of financial institutions participating in the market is gradually increasing, and this will also happen in any market.

Is the current stage from early to maturity a necessary phase? My answer is yes. Stablecoins have separated the payment function of blockchain technology, so think about what Bitcoin really is. A reporter just asked me if it is really digital gold, and I said that this statement is somewhat controversial. Why?

Because it depends on the individual. For me, I might immediately get what you are trying to say. But when you talk about this to ordinary investors, their first reaction in their minds is gold. So what is gold? It can only be defined as a tradable commodity asset with a value maintenance function; that is a complete definition. Some assets can have a value maintenance function, but they may not necessarily possess what we call large-scale financialization or tradability.

Let me give you a simple example: for instance, my younger son's AJ basketball shoes, do they have value? Many people will have a huge deviation in understanding value. For example, do the figurines you buy have value? Does the Richard Mille watch you buy have value? First of all, if it is a widely recognized value, that’s fine; emotional value is also value, and companionship value is also value. But whether it possesses large-scale financialization and tradability is uncertain.

Then you might ask, do the wooden pieces you have have value? Do walnuts have value? Does the clivia have value? You would say they have no value, which is incorrect because if the definition is a broad value, then saying they have no value is definitely wrong. You would say they have value, but if it is financialized and tradable, in other words, that is also incorrect because they do not.

So a complete definition of any asset is very important.

The standard definition of crypto assets is now very clear. The development of Western society actually has a clear core path. If the law does not prohibit it, you can do it first, so it encourages you to innovate and encourages you to explore. Just like our financial derivatives back then. Everyone said, my clients have demands for options and swaps, but we do not have this market or regulation, what should we do? Just do it; after doing it, compliance will follow in layers, allowing it to gradually mature. So the entire Western finance is about financial innovation, with compliance following, and finally entering the maturity stage.

Crypto assets follow the same logic. Now you need to judge whether the financial regulation in 2025 has kept up and whether the certain answers have emerged. My answer is: yes. So in the future, you will see the application of technology in payments as stablecoins. Then what will Bitcoin become? An asset with a value maintenance function that is financially tradable; that is its full significance. Of course, I know this definition will certainly upset the fundamentalists of the last era.

But I want to tell you that this is the era; there is no way around it. This is a complete set of things that conform to the logical framework. At this point, Wall Street can fully intervene, and a new chapter is about to begin.

I wonder if my speech today will be recorded in history; of course, I hope it will be recorded in history and provoke some thoughts among everyone. I believe (today's speech) can also answer many people's questions: Fu, an old trader doing FICC, why enter such a new industry? I want to say that you (crypto assets) have matured to the point where they can be included in investment portfolios.

Alright, I will share with you up to this point. Thank you.