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In this Ropes & Gray podcast, asset management partners Brian McCabe and Paulita Pike, and counsel Ed Baer, discuss digital assets and the ways these assets may be included in registered funds.


Paulita Pike: Hello, and thank you for joining us today on this Ropes & Gray podcast. I’m Paulita Pike, a partner in the Chicago office of Ropes & Gray. Joining me today are two of my colleagues from the asset management practice group—Brian McCabe, a partner in our Boston office, and Ed Baer, a counsel in our San Francisco office. In this podcast, which is part of a series of podcasts on asset management issues, we will discuss cryptocurrencies and digital assets, and the ways registered funds might be able to incorporate these assets into their investment portfolios. There is a lot of ground to cover on this topic, so we’ve focused on what we think are the key issues. Before we jump into investment options for registered funds, we should talk a bit about the regulation of these assets. Ed, can you summarize some of the key regulatory issues relating to cryptocurrencies and digital assets?

Ed Baer: Sure. Bitcoin was first conceived in 2009, and for several years, it seemed to fly below the regulatory radar. But eventually, regulators took notice of emerging digital assets, and in 2015, the Commodity Futures Trading Commission asserted that virtual currencies such as bitcoin are commodities.

Not to be outdone, the SEC began